X Corporation owns 80 percent of Y Corporation's common stock and 40 percent of Z Corporation's common stock.Additionally,Y Corporation owns 35 percent of Z Corporation's common stock.The acquisitions were made at book values.The following information is available for 20X8:

-Based on the information provided,what amount will be reported as dividends declared in X Corporation's 20X8 consolidated retained earnings statement?

Question

X Corporation owns 80 percent of Y Corporation's common stock and 40 percent of Z Corporation's common stock.Additionally,Y Corporation owns 35 percent of Z Corporation's common stock.The acquisitions were made at book values.The following information is available for 20X8:
 
-Based on the information provided,what amount will be reported as dividends declared in X Corporation's 20X8 consolidated retained earnings statement?

Quizplus · Accepted Answer

The dividends declared in X Corporation's 20X8 consolidated retained earnings statement is $30,000. This is because the dividends declared are equal to the dividends paid plus the change in retained earnings. The change in retained earnings is $30,000, which is calculated as the beginning retained earnings of $100,000 minus the ending retained earnings of $70,000.

X Corporation Owns 80 Percent of Y Corporation's Common Stock