2010-08-12_103926_Mcqs_for_artick_light - 1) Michangelo Co....

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
1) Michangelo Co. paid accountants and lawyers $100,000 in order to acquire Florence Company. Michangelo will treat the $100,000: an expense for the current year. a prior period adjustment to retained earnings. additional cost to investment of Florence on the consolidated balance sheet. a reduction in paid-in capital 2) Raphael Company paid $2,000,000 for the net assets of Paris Corporation and Paris was then dissolved. Paris had no liabilities. The fair values of Paris? assets were $2,500,000. Paris? s only non-current assets were land and equipment with fair values of $160,000 and $640,000, respectively. At what value will the equipment be recorded by Raphael? $0 $240,000 $400,000 $640,000 3) Jacana Corporation paid $200,000 for a 25% interest in Lilypad Corporation?s common stock on January 1, 2005, but was not able to exercise significant influence over Lilypad. During 2006, Jacana reported income of $120,000, excluding its income from Lilypad, and paid dividends of $50,000. Lilypad reported net income of $40,000 during 2006 and paid dividends of $20,000. Jacana should report net income for 2006 in the amount of:
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 3

2010-08-12_103926_Mcqs_for_artick_light - 1) Michangelo Co....

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online