On January 1 2013, Paulus Company purchased 75% of Sweet Corporation for $500,000.Sweet' stockholders' equity on that date was equal to $600,000 and Sweet had 60,000 shares issued and outstanding on that date.Sweet Corporation sold an additional 15,000 shares of previously unissued stock on December 31, 2013.
AssumeAssuming that Paulus Company purchased the additional shares, what would be their current percentage ownership on December 31, 2013?

Question

Quizplus · Accepted Answer

Paulus initially owned 75% of Sweet's 60,000 shares, which is 45,000 shares. After Sweet issued an additional 15,000 shares, the total shares became 75,000. If Paulus purchased all 15,000 new shares, they would own 60,000 out of 75,000 shares, which is 80%.

On January 1 2013, Paulus Company Purchased 75% of Sweet