Sample Quiz for Chapter 3 - Indiana University of...

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Indiana University of Pennsylvania Department of Accounting ACCT 401/501: Advanced Accounting Dr. Rahman Sample Quiz for Chapter 3 Circle the best choice. 1. Penguin Corporation owns 90% of the outstanding voting stock of Crevice Company and Burrow Corporation owns the remaining 10% of Crevice’s voting stock. On the consolidated financial statements of Penguin Corporation and Subsidiary, Burrow is a. an affiliate. b. a noncontrolling interest. c. an equity investee. d. a related party 2. On June 1, 2018, Gull Company acquired 100% of the stock of Scrap Inc. On this date, Gull had Retained Earnings of $200,000 and Scrap had Retained Earnings of $100,000. On December 31, 2018, Gull had Retained Earnings of $240,000 and Scrap had Retained Earnings of $120,000. The amount of Retained Earnings that appeared in the December 31, 2018 consolidated balance sheet was: 3. On July 1, 2018, when Worm Company’s total stockholders’ equity was $180,000, Bird Corporation purchased 7,000 shares of Worm’s common stock at $30 per share. Worm Company had 10,000 shares of common stock outstanding both before and after the purchase by Bird, and the book value of Worm’s net assets on July 1, 2018 was equal to the fair value. On a consolidated balance sheet prepared at July 1, 2018, goodwill would be
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