John owns 30 of outstanding stock of wally and has the

Reference no: EM13576536

John owns 30% of outstanding stock of Wally and has the ability to significanlty influence the investee's operations and decision making. On Jan 1, 2011, the balance in the investment in Wally account is $335,000. Amortization associated with this acquisistion is $9000 per year. In 2011, Wally earns an income of $90000 and pays cas dividends of $30000. Previously in 2010, Wally had sold inventory costing $24,000 to John for $40000. Russel consumed all but 25% of this merchanidse during 2010 and used the rest during 2011. Wally sold additional inventory costing $28000 to John for $50,000 in 2011. John did not sonsume 40% of these 2011 purchases from Wally until 2012.

a) What amount of equity mehtod income would John recognize in 2011 from its ownership interest in Wally?

b) What is the equity method balance in the Investment in Wally account at the end of 2011?

Reference no: EM13576536

Questions Cloud

The billboard for the florida lottery announces an 18000000 : the billboard for the florida lottery announces an 18000000 prize to the winner. the winner has the option of receiving

Becky lewis estimates that she will need 30000 in five : becky lewis estimates that she will need 30000 in five years for a down payment on a new home. what amount would she

What does this mean and what is the significance of the : discussion question-1 answer in 3- paragraphs apa style and cite work please provide referencesdiscussion question 1one

Froment corporation uses the weighted-average method in its : froment corporation uses the weighted-average method in its process costing system. this month the beginning inventory

John owns 30 of outstanding stock of wally and has the : john owns 30 of outstanding stock of wally and has the ability to significanlty influence the investees operations and

A retail company has two departments indoor and outdoor the : a retail company has two departments indoor and outdoor. the companys most recent monthly contribution format income

This mistake had a material effect on the amount of income : a review of the notes payable files discovers that three years ago the company reported the entire amount of a payment

On january 1 jkr shop had 490000 of inventory at cost in : on january 1 jkr shop had 490000 of inventory at cost. in the first quarter of the year it purchased 1630000 of

Bones and skeletal tissues this is the same questions as : this is the same questions as sent a 10 min ago. ltbrgtaddition quotjustified ideas and responses through appropriate

User Account

All Pages