If Goehler applies the partial equity method in accounting for Kenneth, what is the consolidated balance for the Equipment account as of December 31, 2018?
A) $1,080,000.
B) $1,104,000.
C) $1,100,000.
D) $1,468,000.
E) $1,475,000.

Question

Quizplus · Accepted Answer

The partial equity method requires the parent company to include its share of the subsidiary's net assets on its balance sheet. Kenneth's Equipment account has a balance of $120,000, and 90% of that is owned by Goehler, so Goehler's share is $108,000. Goehler's own Equipment account has a balance of $996,000. Adding these two amounts together gives a consolidated balance for Equipment of $1,104,000 ($996,000 + $108,000).

If Goehler Applies the Partial Equity Method in Accounting for Kenneth