At the start of 2071 Cowboy Corp. purchased 25% of Bebop Tech Inc. for $45 million. At
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At the start of 2071 Cowboy Corp. purchased 25% of Bebop Tech Inc. for $45 million. At the time of purchase, the carrying value of Bebop Tech's net assets was $75 million. The fair value of Bebop Tech's depreciable assets (5 year useful life remaining) was $25 million in excess of their book value. For this year, Bebop Tech reported a net income of $50 million and declared and paid $25 million in dividends. What amount will Cowboy Corp. recognize as additional depreciation at the end of 2071?
A. $6.25 Million
B. $5 Million
C. $1 Million
D. $125 Million
Related Book For
Accounting concepts and applications
ISBN: 978-0538745482
11th Edition
Authors: Albrecht Stice, Stice Swain
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