On July 1, 2011, Mountain Systems acquired 8,000 shares of Precision Services' 40,000 outstanding common shares at a cost of $240,000. The book value of Precision's net assets on that date was $880,000. The following data pertain to Precision Services for 2011:

Any excess of cost over book value is attributable to depreciable properties the market value of which exceeds the carrying value. The remaining life of the equipment is 10 years.

Question

On July 1, 2011, Mountain Systems acquired 8,000 shares of Precision Services' 40,000 outstanding common shares at a cost of $240,000. The book value of Precision's net assets on that date was $880,000. The following data pertain to Precision Services for 2011:
  
Any excess of cost over book value is attributable to depreciable properties the market value of which exceeds the carrying value. The remaining life of the equipment is 10 years.

Quizplus · Accepted Answer

The Answer of On July 1, 2011, Mountain Systems acquired 8,000 shares of Precision Services' 40,000 outstanding common shares at a cost of $240,000. The book value of Precision's net assets on that date was $880,000. The following data pertain to Precision Services for 2011:
  
Any excess of cost over book value is attributable to depreciable properties the market value of which exceeds the carrying value. The remaining life of the equipment is 10 years.

On July 1, 2011, Mountain Systems Acquired 8,000 Shares of Precision