Use the following information for questions 99 through 102.
The summarized balance sheets of Goebel Company and Dobbs Company as of December 31, 2014 are as follows:
-If Goebel Company acquired a 20% interest in Dobbs Company on December 31, 2014 for $175,000 and the fair value method of accounting for the investment were used, the amount of the debit to Equity Investments (Dobbs) would have been

Question

Use the following information for questions 99 through 102.
The summarized balance sheets of Goebel Company and Dobbs Company as of December 31, 2014 are as follows: 
-If Goebel Company acquired a 20% interest in Dobbs Company on December 31, 2014 for $175,000 and the fair value method of accounting for the investment were used, the amount of the debit to Equity Investments (Dobbs) would have been

Quizplus · Accepted Answer

The correct amount of the debit to Equity Investments (Dobbs) under the fair value method for a 20% interest acquired for $175,000 is exactly $175,000. This is because under the fair value method, the investment is recorded at the purchase price, which is $175,000 in this case.

Use the Following Information for Questions 99 Through 102