Question: Why is anwser C correct? 28. When applying the equity method, how is the excess of cost over book value calculated and accounted for? A)

Why is anwser C correct? 28. When applying the equity method,

Why is anwser C correct? 28. When applying the equity method, how is the excess of cost over book value calculated and accounted for? A) The excess is allocated to the difference between fair value and book value multiplied by the percent ownership of current assets. B) The excess is allocated to the difference between fair value and book value multiplied by the percent ownership of total assets. C) The excess is allocated to the difference between fair value and book value multiplied by the percent ownership of net assets. D) The excess is allocated to goodwill. E) The excess is ignored. Answer: C

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!

9 . When an investor sells shares of its investee company, which of the following statements is true? A ) A realized gain or loss is reported as the difference between selling price and original...

When applying the equity method, how is the excess of cost over book value calculated and accounted for? The excess is allocated to the difference between fair value and book value multiplied by the...

When applying the equity method, how is the excess of cost ower book value calculated and accounted for? Multiple Choice The eacess is allocated to the difference between far value and book value...

When applying the equity method, how is the excess of cost over book value accounted for? The excess is allocated to the difference between fair value and book value multiplied by the percent...

When applying the equity method, how is the excess of cost over book value calculated and accounted for? Multiple Choice The excess is allocated to the difference between fair value and book value...

I have attached the question as a word file, thanks! As we enter week 8, what did you learn from this course? How will the information be useful in your other classes and in your career? Running...

Hi, This subject is financial accounting, here is a short essay type question, approximately 5 paragraphs. ''Drawing on private interest theory, what powers do you believe the Australian Accounting...

Intermediate Financial Reporting journal entry on the investor's books will include a debit to the Investment account Intermediate Financial Reporting-I b. credit to Retained E credit to the...

JOHNSON & JOHNSON AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EARNINGS (Dollars and Shares in Millions Except Per Share Amounts) (Note 1)* 2016 71,890 21,789 50.101 20,067 9.143 29 Sales to customers...

ACC 3010 PROJECT 3 PART 3 WINTER 2020 Due April 23 before 5pm - You must submit your completed excel file to the submission link on Canvas. Your file must be named correctly - "Your name (first and...

Prerana started Designer Garments. The following transactions took place in the first month i.e Apri 2021 April 01: Prerana invested cash in the company's share capital Rs.75000/ April 02: Paid rent...

The Maxon 18-Watt permanent magnet DC motor used in the lab exercises has the following parameters: 1. Maximum Power: 18W 1. Maximum voltage: +15V 2. Torque Constant: 0.0502 Nm/A 2. Maximum...

Here is financial information for Bramble Inc. \ table [ [ , December 3 1 , 2 0 2 2 , December 3 1 , 2 0 2 1 ] , [ Current assets,$ 1 2 4 , 2 0 0 , $ 1 0 0 , 0 0 0

Case from the 5 dysfunctions of a team book by Patrick lencioni Underachievement What did Kathryn do on her first two weeks on the job that concerned everyone? Of the behaviors that Kathryns staff...

11. Take a familiar problem as your starting point. a) Frame the problem so that it promotes aggressive behaviour. b) Frame the problem so that it promotes defensive behaviour.

2. Give examples from your everyday life that understanding the context is crucial to how you act.

4. Give examples of how a communication situation can change from a win-lose to a winwin situation.