Question: Why might a subsidiary decide to issue new shares of
Why might a subsidiary decide to issue new shares of common stock to parties outside the business combination?
Answer to relevant QuestionsWashburn Company owns 75 percent of Metcalf Company’s outstanding common stock. During the current year, Metcalf issues additional shares to outside parties at a price more than its per share consolidated value. How does ...Mattoon, Inc., owns 80 percent of Effingham Company. For the current year, this combined entity reported consolidated net income of $500,000. Of this amount $465,000 was attributable to Mattoon’s controlling interest while ...On January 1, 2011, Stamford issues 10,000 additional shares of common stock for $15 per share. Neill does not acquire any of this newly issued stock. How does this transaction affect the parent company’s Additional ...Opus, Incorporated, owns 90 percent of Bloom Company. On December 31, 2010, Opus acquires half of Bloom’s $500,000 outstanding bonds. These bonds had been sold on the open market on January 1, 2008, at a 12 percent ...The following separate income statements are for Mason and its 80 percent–owned subsidiary, Dixon:Additional Information• Amortization expense resulting from Dixon’s excess acquisition-date fair value is $25,000 per ...
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