On January 1, 20X9, Princeton Company acquired 80 percent of the common stock and 60 percent of the preferred stock of Stanford Company, for $400,000 and $60,000, respectively. At the time of acquisition, the fair value of the common shares of Stanford Company held by the noncontrolling interest was $100,000. Stanford Company's balance sheet contained the following balances: Preferred Stock ($5 par value)$100,000 Common Stock ($10 par value) 200,000 Retained Earnings 300,000 Total Stockholders' Equity$600,000 For the year ended December 31, 20X9, Stanford Company reported net income of $100,000 and paid dividends of $40,000. The preferred stock is cumulative and pays an annual dividend of 10 percent.Based on the preceding information, what will be the equity method income reported
by Princeton Company from its investment in Stanford Company during 20X9?
A. $32,000
B. $72,000
C. $48,000
D. $30,000
Answer: B
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Sky Company collected $12,350 in interest during 2013 . Sky showed $1,850 in interest receivable on its December 31 . 2013 . balance sheet and $5,300 on December 31 . 2012 . The interest revenue on the income statement for 2013 was
a. $3,450. b. $8,900. c. $12,350. d. $14,200.
On February 1 . 2015, Gaslight Corp issued 1 . percent, $2,000,000 face value, ten-year bonds for $2,234,000 plus accrued interest. The bonds are dated November 1 . 2014, and interest is payable on May 1 and November 1 . Gaslight reacquired all of these bonds at 102 on May 1 . 2018, and retired them. Unamortized bond premium on that date was $156,000 . Ignoring the income tax effect, what was
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A mature, financially healthy company typically has a cash flow from operations to total liabilities ratio of
a. 5% or more. b. 20% or more. c. 45% or more. d. 70% or more. e. 90% or more.
In the opening case “How We’re Fixing Up Tyco,” what did Tyco do to re-create its image?
a. Changed its corporate logo b. Changed the board members c. Sold off the business d. Merged with another company