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Advanced Accounting 11th Edition by Paul Fischer,William Tayler, Rita Cheng
Edition 11ISBN: 978-0538480284Advanced Accounting 11th Edition by Paul Fischer,William Tayler, Rita Cheng
Edition 11ISBN: 978-0538480284 Exercise 12
Subsidiary Company S had the following stockholders' equity on January 1, 2014, prior to issuing 20,000 additional new shares to noncontrolling shareholders:
Common stock ($1 par), 100,000 shares issued and outstanding....... $ 100,000
Paid-in capital in excess of par.................................. 1,900,000
Retained earnings............................................ 2,000,000
Total equity............................................... $4,000,000
At that time, the parent company owned 90,000 Company S shares. Assume that the parent acquired the shares at a price equal to their book value. What is the impact on the parent's investment account of the sale of 20,000 additional shares by the subsidiary for $45 per share?
Common stock ($1 par), 100,000 shares issued and outstanding....... $ 100,000
Paid-in capital in excess of par.................................. 1,900,000
Retained earnings............................................ 2,000,000
Total equity............................................... $4,000,000
At that time, the parent company owned 90,000 Company S shares. Assume that the parent acquired the shares at a price equal to their book value. What is the impact on the parent's investment account of the sale of 20,000 additional shares by the subsidiary for $45 per share?
Explanation
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• Subsidiary company S had common stock ...
Advanced Accounting 11th Edition by Paul Fischer,William Tayler, Rita Cheng
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