Puddle Incorporated purchased an 80% interest in Soake Company,located in England.Puddle paid $1,560,000 on January 1,2014,at a time when the book values of Soake equaled the fair values.Any excess cost/book value differential was attributed to a patent with a five-year remaining useful life.Soake's books are kept in the functional currency,pounds.A summary of Soake's equity is shown below for the first year that Puddle had ownership interest.

Required:
Determine Puddle's income from Soake for 2014,and the balance of Puddle's Investment in Soake account at December 31,2014.

Question

Puddle Incorporated purchased an 80% interest in Soake Company,located in England.Puddle paid $1,560,000 on January 1,2014,at a time when the book values of Soake equaled the fair values.Any excess cost/book value differential was attributed to a patent with a five-year remaining useful life.Soake's books are kept in the functional currency,pounds.A summary of Soake's equity is shown below for the first year that Puddle had ownership interest.
  
Required:
Determine Puddle's income from Soake for 2014,and the balance of Puddle's Investment in Soake account at December 31,2014.

Quizplus · Accepted Answer

The Answer of Puddle Incorporated purchased an 80% interest in Soake Company,located in England.Puddle paid $1,560,000 on January 1,2014,at a time when the book values of Soake equaled the fair values.Any excess cost/book value differential was attributed to a patent with a five-year remaining useful life.Soake's books are kept in the functional currency,pounds.A summary of Soake's equity is shown below for the first year that Puddle had ownership interest.
  
Required:
Determine Puddle's income from Soake for 2014,and the balance of Puddle's Investment in Soake account at December 31,2014.

Puddle Incorporated Purchased an 80% Interest in Soake Company,located in England.Puddle