On January 1, 2013, Platt Corporation purchased a 30% interest in Sandig Company for $450,000. On this date, the fair values of Sandig's assets and liabilities are assumed to be the same as their book values. Platt will account for Sandig using the equity method. Sandig's adjusted trial balance at the date of acquisition and year end were as follows:
Required:
1. What is Platt's investment income from Sandig for the year ending December 31, 2013?
2. Calculate Platt's investment in Sandig at year end December 31, 2013.

Question

On January 1, 2013, Platt Corporation purchased a 30% interest in Sandig Company for $450,000. On this date, the fair values of Sandig's assets and liabilities are assumed to be the same as their book values. Platt will account for Sandig using the equity method. Sandig's adjusted trial balance at the date of acquisition and year end were as follows:
  Required:
1. What is Platt's investment income from Sandig for the year ending December 31, 2013?
2. Calculate Platt's investment in Sandig at year end December 31, 2013.

Quizplus · Accepted Answer

The Answer of On January 1, 2013, Platt Corporation purchased a 30% interest in Sandig Company for $450,000. On this date, the fair values of Sandig's assets and liabilities are assumed to be the same as their book values. Platt will account for Sandig using the equity method. Sandig's adjusted trial balance at the date of acquisition and year end were as follows:
  Required:
1. What is Platt's investment income from Sandig for the year ending December 31, 2013?
2. Calculate Platt's investment in Sandig at year end December 31, 2013.

On January 1, 2013, Platt Corporation Purchased a 30% Interest