Subsidiary Company S had the following stockholders' equity on January 1, 2014, prior to issuing 20,000 additional new shares to noncontrolling shareholders:

Common stock ($1 par), 100,000 shares issued and outstanding ................. $ 100,000

Paid-in capital in excess of par ...................................................................... 1,900,000

Retained earnings ............................................................................................ 2,000,000

Total equity .................................................................................................... $4,000.000

At that time, the parent company owned 90,000 Company S shares. Assume that the parent acquired the shares at a price equal to their book value. What is the impact on the parent's investment account of the sale of 20,000 additional shares by the subsidiary for $45 per share?

Answer rating: 100% (QA)

Subsidiary company S had common stock worth of 100000 paidin capital in excess of par is 1900000 and ... View the full answer