On January 1, 2023, Stream Company acquired 25 percent of the outstanding voting shares of Q-Video,...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
On January 1, 2023, Stream Company acquired 25 percent of the outstanding voting shares of Q-Video, Incorporated, for $718,000. Q- Video manufactures specialty cables for computer monitors. On that date, Q-Video reported assets and liabilities with book values of $1.8 million and $669,000, respectively. A customer list compiled by Q-Video had an appraised value of $234,000, although it was not recorded on its books. The expected remaining life of the customer list was five years with straight-line amortization deemed appropriate. Any remaining excess cost was not identifiable with any particular asset and thus was considered goodwill. Q-Video generated net Income of $222,000 in 2023 and a net loss of $147,000 in 2024. In each of these two years, Q-Video declared and paid a cash dividend of $16,000 to its stockholders. During 2023, Q-Video sold Inventory that had an original cost of $111,000 to Stream for $150,000. Of this balance, $75,000 was resold to outsiders during 2023, and the remainder was sold during 2024. In 2024, Q-Video sold Inventory to Stream for $175,000. This Inventory had cost only $140,000. Stream resold $98,000 of the Inventory during 2024 and the rest during 2025. Required: For 2023 and then for 2024, compute the amount that Stream should report as Income from its Investment in Q-Video in its external financial statements under the equity method. Note: Enter your answers in whole dollars and not in millions. 2023 2024 of of On January 1, 2023, Stream Company acquired 25 percent of the outstanding voting shares of Q-Video, Incorporated, for $718,000. Q- Video manufactures specialty cables for computer monitors. On that date, Q-Video reported assets and liabilities with book values of $1.8 million and $669,000, respectively. A customer list compiled by Q-Video had an appraised value of $234,000, although it was not recorded on its books. The expected remaining life of the customer list was five years with straight-line amortization deemed appropriate. Any remaining excess cost was not identifiable with any particular asset and thus was considered goodwill. Q-Video generated net Income of $222,000 in 2023 and a net loss of $147,000 in 2024. In each of these two years, Q-Video declared and paid a cash dividend of $16,000 to its stockholders. During 2023, Q-Video sold Inventory that had an original cost of $111,000 to Stream for $150,000. Of this balance, $75,000 was resold to outsiders during 2023, and the remainder was sold during 2024. In 2024, Q-Video sold Inventory to Stream for $175,000. This Inventory had cost only $140,000. Stream resold $98,000 of the Inventory during 2024 and the rest during 2025. Required: For 2023 and then for 2024, compute the amount that Stream should report as Income from its Investment in Q-Video in its external financial statements under the equity method. Note: Enter your answers in whole dollars and not in millions. 2023 2024 of of
Expert Answer:
Answer rating: 100% (QA)
To compute Stream Companys income from its investment in QVideo using the equity method For 2023 ... View the full answer
Related Book For
Advanced Accounting
ISBN: 978-0077431808
10th edition
Authors: Joe Hoyle, Thomas Schaefer, Timothy Doupnik
Posted Date:
Students also viewed these accounting questions
-
On January 1, 2017, Stream Company acquired 30 percent of the outstanding voting shares of Q-Video, Inc., for $770,000. Q-Video manufactures specialty cables for computer monitors. On that date,...
-
On January 1, 2020, Stream Company acquired 30 percent of the outstanding voting shares of Q-Video, Inc., for $684,000. Q-Video manufactures specialty cables for computer monitors. On that date,...
-
Why is globalization of industries a common factor today?
-
A freight train is to carry 12 coal cars, 5 cars full of lumber, and 4 tankers all carrying kerosene. How many different arrangements are possible?
-
In Exercises find the arc length of the curve on the interval[0, 2]. Circle circumference: x = a cos , y = a sin
-
Given the formulation of the free boundary problem for the valuation of an American Put option, \[\begin{aligned}& \frac{\partial P}{\partial t}+\frac{1}{2} \sigma^{2} S^{2} \frac{\partial^{2}...
-
Fowler Company produces a product that sells for $200 per unit and has a variable cost of $125 per unit. Fowler incurs annual fixed costs of $450,000. Required a. Determine the sales volume in units...
-
The entire graph of the function h is shown in the figure below. Write the domain and range of h using interval notation. 3 m 3 4
-
Find the derivative of the function at the given point in the direction of A. f(x.y) = -6x-4y, (8,9), A= 3i- 4j 368 OA. 272 O B. 5 464 O D. -112
-
Explain, The experimental studies in Section 5 challenge the idea of self-interest in economics and government policies. They show that people are motivated by factors beyond material incentives,...
-
In the event that oil prices increase sharply, or there is a Global spike in terrorist attacks: Does the event affect aggregate demand (AD) or aggregate supply (AS)? Is the event's effect on AD or AS...
-
Why is having knowledge and the capability to creatively apply that knowledge in creating unique solutions for their buyers so important for today's salesperson?
-
What insights can be gained from comparative genomics studies across species, shedding light on evolutionary relationships, genome evolution, and the functional significance of conserved sequences?
-
can you write summary of chapter 4 - the emergence of modern price theory book- the history of economic ideas by BRANDON DUPONT write summary in about 600-1200 words
-
Write an example of an acquisition that everyone thought was going to go poorly but turned out well?
-
Explain why it is not wise to accept a null hypothesis.
-
Wakuluks approach to economic forecasting: A. is flexible and limited in complexity. B. can give a false sense of precision and provide false signals. C. imposes no consistency of analysis across...
-
Wakuluk is most likely to make significant adjustments to her estimate of the future growth trend for which of the following countries? A. Country Y only B. Country Z only C. Countries Y and Z Neshie...
-
Based on Exhibit 1, what capital market effect is Country Z most likely to experience in the short-term? A. Cyclical assets attract investors. B. Monetary policy becomes restrictive. C. The yield...
Study smarter with the SolutionInn App