Question: Highlight Inc owns all outstanding stock of Kiort Corporation The

Highlight, Inc., owns all outstanding stock of Kiort Corporation. The two companies report the following balances for the year ending December 31, 2011:


On January 1, 2011, Highlight acquired on the open market bonds for $108,000 originally issued by Kiort. This investment had an effective rate of 8 percent. The bonds had a face value of $100,000 and a cash interest rate of 9 percent. At the date of acquisition, these bonds were shown as liabilities by Kiort with a book value of $84,000 (based on an effective rate of 11 percent). Determine the balances that should appear on a consolidated income statement for2011.
View Solution:


Sale on SolutionInn
Sales11
Views870
Comments
  • CreatedOctober 04, 2014
  • Files Included
Post your question
5000