Wader's Corporation paid $120,000 for a 25% interest in Shell Company on July 1, 2010.No information is available on the fair value of Shell's assets and liabilities.Assume the equity method.Shell's trial balances at July 1, 2010 and December 31, 2010 were as follows:
Required:
1.What is Wader's investment income from Shell for the year ending December 31, 2010?
2.Calculate Wader's investment in Shell at year end December 31, 2010.

Question

Wader's Corporation paid $120,000 for a 25% interest in Shell Company on July 1, 2010.No information is available on the fair value of Shell's assets and liabilities.Assume the equity method.Shell's trial balances at July 1, 2010 and December 31, 2010 were as follows:
  Required:
1.What is Wader's investment income from Shell for the year ending December 31, 2010?
2.Calculate Wader's investment in Shell at year end December 31, 2010.

Quizplus · Accepted Answer

The Answer of Wader's Corporation paid $120,000 for a 25% interest in Shell Company on July 1, 2010.No information is available on the fair value of Shell's assets and liabilities.Assume the equity method.Shell's trial balances at July 1, 2010 and December 31, 2010 were as follows:
  Required:
1.What is Wader's investment income from Shell for the year ending December 31, 2010?
2.Calculate Wader's investment in Shell at year end December 31, 2010.

Wader's Corporation Paid $120,000 for a 25% Interest in Shell