View the step-by-step solution to:

Can you please help to solve it?

Can you please help to solve it?



On January 1, 2014, X Corporation purchased 20% of the outstanding voting common stock of Y Company for $300,000. The Book Value of the acquired shares was $275,000. The excess of cost over book value is attributable to an asset Y's books that had a remaining useful life of five years and is being depreciated straight line. For the year ended December 31, 2014, Y reported net income of $125,000 and paid cash dividends of $25,000. What is the carrying value of X's investment in Y at December 31, 2014?

a.     $295,000

b.    $300,000

c.     $315,000

d.    $320,000

Top Answer

Sign up to view the full answer

Why Join Course Hero?

Course Hero has all the homework and study help you need to succeed! We’ve got course-specific notes, study guides, and practice tests along with expert tutors.

-

Educational Resources
  • -

    Study Documents

    Find the best study resources around, tagged to your specific courses. Share your own to gain free Course Hero access.

    Browse Documents
  • -

    Question & Answers

    Get one-on-one homework help from our expert tutors—available online 24/7. Ask your own questions or browse existing Q&A threads. Satisfaction guaranteed!

    Ask a Question
Ask a homework question - tutors are online