Perfect Corporation acquired 70 percent of Trevor Company's shares on December 31, 2008, for $140,000. At that date, the fair value of the noncontrolling interest was $60,000. On January 1, 2010, Perfect acquired an additional 10 percent of Trevor's common stock for $32,500. Summarized balance sheets for Trevor on the dates indicated are as follows:
Trevor paid dividends of $10,000 in each of the three years. Perfect uses the fully adjusted equity method in accounting for its investment in Trevor and amortizes all differentials over 5 years against the related investment income. All differentials are assigned to patents in the consolidated financial statements.
-Based on the preceding information,what was the balance in Perfect's Investment in Trevor Company Stock account on December 31,2010?
A) $211,500
B) $218,000
C) $173,000
D) $216,000
Correct Answer:
Verified
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