Determine the effective annualized cost of forgoing the trade discount on terms 2/15 net 65
A) 11.30% B) 32.6% C) 14.69% D) 48.98%
C
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Cash received through the mail should be handled by only one employee to achieve effective internal control
Indicate whether the statement is true or false
Allan Clapp is a purchasing agent for Deep River Mfg. Co. He regularly buys items such as nails, light bulbs, brooms, and sweeping compounds. In other words, he buys
A. components. B. accessory equipment. C. professional services. D. supplies. E. installations.
What type of planning has the greatest effect on production costs and flexibility?
A) Capacity B) Layout C) Quality D) Location E) Process
Assuming that Davis purchases 100% of Martin for $300,000, answer the following:
Davis Inc. purchased a controlling interest in Martin Inc. on January 1, 2015, when Martin's common shares and retained earnings were carried at $180,000 and $60,000 respectively. On that date, Martin's book values approximated its fair values, with the exception of the company's inventories and a Patent held by Martin. The patent, which had an estimated remaining useful life of ten years, had a fair value which was $20,000 higher than its book value. Martin's Inventories on January 1, 2015 were estimated to have a fair value that was $16,000 higher than their book value. It was predicted that Martin's goodwill impairment test, which was to be conducted on December 31, 2016, would result in a loss equal to 10% of the goodwill (regardless of the amount) at the date of acquisition being recorded. During 2015, Martin reported a net income of $60,000 and paid $12,000 in dividends. Martin's 2016 net income and dividends were $72,000 and $15,000, respectively. Martin uses straight-line amortization for all of its assets. Required: a) Prepare Davis' Equity Method journal entries for 2015 and 2016. b) Compute the following as at December 31, 2016: i. Investment in Martin Inc. ii. Goodwill iii. The amount of unamortized acquisition differential.