Question
In: Accounting
Analyzing Equity Method Investment Footnotes Merck & Co., Inc. reports a December 31, 2016 balance of...
Analyzing Equity Method Investment
Footnotes
Merck & Co., Inc. reports a December 31, 2016 balance of $726
million in "Investments in affiliates accounted for using the
equity method" ("Investments in affiliates").
Provide the entries for the following events for fiscal year 2017:
a. Merck's share of income from its affiliates was $53 million.
b. Merck received dividends and distributions from its affiliates of $4 million during fiscal year 2017.
Note: Enter answers in millions.
| Ref. | Description | Debit | Credit |
|---|---|---|---|
| a. | AnswerCashDividend incomeGoodwillIncome from affiliatesInterest receivableInvestment in affiliatesRealized gainRealized lossRetained earningsUnrealized gain - AOCIUnrealized loss - AOCI | Answer | Answer |
| AnswerCashDividend incomeGoodwillIncome from affiliatesInterest receivableInvestment in affiliatesRealized gainRealized lossRetained earningsUnrealized gain - AOCIUnrealized loss - AOCI | Answer | Answer | |
| b. | AnswerCashDividend incomeGoodwillIncome from affiliatesInterest receivableInvestment in affiliatesRealized gainRealized lossRetained earningsUnrealized gain - AOCIUnrealized loss - AOCI | Answer | Answer |
| AnswerCashDividend incomeGoodwillIncome from affiliatesInterest receivableInvestment in affiliatesRealized gainRealized lossRetained earningsUnrealized gain - AOCIUnrealized loss - AOCI | Answer | Answer |
c. After these events, what should be the balance in Merck’s
investments in affiliates account at December 31, 2017?
$Answer million
Solutions
Expert Solution
| Ref. | Description | Debit | Credit | |
| a. | Investment in affiliates | 53 million | ||
| Income from affiliates | 53 million | |||
| b. | Cash | 4 million | ||
| Investment in affiliates | 4 million | |||
| c | Calculation of Merck's investment in affiliates at the end of the year | |||
| Balance as on 31 Dec 2016 | 726.0 | million | ||
| Add: Income from affiliated during 2017 | 53.0 | million | ||
| Less: Dividend received during 2017 | (4.0) | million | ||
| Balance as on 31 Dec 2017 | 775.0 | million |
ekkarill92 answered 2 years agoRelated Solutions
Kohler Corporation reports the following components of stockholders’ equity on December 31, 2016:
Kohler Corporation reports the following components of stockholders’ equity on December 31, 2016:
Common stock—$20 par value, 100,000 shares authorized,50,000 shares issued and outstanding
$
1,000,000
Paid-in capital in excess of par value, common stock
80,000
Retained earnings
430,000
Total stockholders' equity
$
1,510,000
In year 2017, the following transactions affected its stockholders’ equity accounts.
Jan.
1
Purchased 4,500 shares of its own stock at $20 cash per share.
Jan.
5
...
Larkspur Inc. had the following balance sheet at December 31, 2016. LARKSPUR INC. BALANCE SHEET DECEMBER...
Larkspur Inc. had the following balance sheet at December 31,
2016.
LARKSPUR INC.
BALANCE SHEET
DECEMBER 31, 2016
Cash
$ 20,990
Accounts payable
$ 30,990
Accounts receivable
22,190
Notes payable (long-term)
41,990
Investments
32,990
Common stock
100,990
Plant assets (net)
81,000
Retained earnings
24,190
Land
40,990
$ 198,160
$ 198,160
During 2017, the following occurred.
1.
Larkspur Inc. sold part of its
investment portfolio for $ 15,071. This transaction resulted in a
gain of $ 3,471 for the firm. The...
Lander Inc. had the following balance sheet on December 31, 2016: LANDER, INC. Balance Sheet December...
Lander Inc. had the following balance sheet on December 31,
2016:
LANDER, INC.
Balance Sheet
December 31, 2016
Cash
$49,830
Accounts payable
$37,180
Accounts receivable
$20,790
Bonds payable
$38,500
Investments
$27,500
Common stock
$209,000
Plant assets (net)
$85,800
Retained earnings
$20,240
Land
$121,000
Total Assets
$304,920
Total Liabilities & Equity
$304,920
During 2017 the following occurred:
Lander liquidated its investment portfolio at a loss of
$7,150.
A tract of land was purchased for $34,100.
An additional $22,000 in common stock...
The comparative balance sheet of Whitman Co. at December 31, 2016 and 2015, is as follows:...
The comparative balance sheet of Whitman Co. at December 31,
2016 and 2015, is as follows:
1
Dec. 31, 2016
Dec. 31, 2015
2
Assets
3
Cash
$918,420.00
$965,310.00
4
Accounts receivable (net)
828,210.00
762,450.00
5
Inventories
1,268,100.00
1,162,260.00
6
Prepaid expenses
29,220.00
35,270.00
7
Land
315,170.00
479,410.00
8
Buildings
1,463,110.00
901,510.00
9
Accumulated depreciation-buildings
(409,500.00)
(383,260.00)
10
Equipment
512,060.00
454,500.00
11
Accumulated depreciation-equipment
(141,780.00)
(159,530.00)
12
Total assets
$4,783,010.00
$4,217,920.00
13
Liabilities and Stockholders’ Equity
14
Accounts payable (merchandise...
The comparative balance sheet of Merrick Equipment Co. for December 31, 2016 and 2015, is as...
The comparative balance sheet of Merrick Equipment Co. for
December 31, 2016 and 2015, is as follows:
1
Dec. 31, 2016
Dec. 31, 2015
2
Assets
3
Cash
$70,720.00
$47,940.00
4
Accounts receivable (net)
207,230.00
188,190.00
5
Inventories
298,520.00
289,850.00
6
Investments
0.00
102,000.00
7
Land
295,800.00
0.00
8
Equipment
438,600.00
358,020.00
9
Accumulated depreciation-equipment
(99,110.00)
(84,320.00)
10
Total assets
$1,211,760.00
$901,680.00
11
Liabilities and Stockholders’ Equity
12
Accounts payable (merchandise creditors)
$205,700.00
$194,140.00
13
Accrued expenses payable (operating expenses)...
The comparative balance sheet of Whitman Co. at December 31, 2016 and 2015, is as follows:...
The comparative balance sheet of Whitman Co. at December 31,
2016 and 2015, is as follows:
1
Dec. 31, 2016
Dec. 31, 2015
2
Assets
3
Cash
$917,690.00
$964,930.00
4
Accounts receivable (net)
?828,620.00
762,860.00
5
Inventories
1,267,970.00
1,162,780.00
6
Prepaid expenses
29,050.00
36,010.00
7
Land
315,250.00
480,690.00
8
Buildings
1,462,990.00
901,470.00
9
Accumulated depreciation-buildings
(409,170.00)
(382,690.00)
10
Equipment
511,480.00
453,680.00
11
Accumulated depreciation-equipment
(142,100.00)
(159,400.00)
12
Total assets
$4,781,780.00
$4,220,330.00
13
Liabilities and Stockholders’ Equity
14
Accounts payable (merchandise...
The comparative balance sheet of Whitman Co. at December 31, 2016 and 2015, is as follows:...
The comparative balance sheet of Whitman Co. at December 31,
2016 and 2015, is as follows:
1
Dec. 31, 2016
Dec. 31, 2015
2
Assets
3
Cash
$918,260.00
$965,110.00
4
Accounts receivable (net)
828,050.00
761,830.00
5
Inventories
1,268,550.00
1,163,510.00
6
Prepaid expenses
28,760.00
35,720.00
7
Land
315,810.00
479,900.00
8
Buildings
1,463,300.00
900,740.00
9
Accumulated depreciation-buildings
(408,350.00)
(381,910.00)
10
Equipment
512,470.00
454,060.00
11
Accumulated depreciation-equipment
(142,270.00)
(159,730.00)
12
Total assets
$4,784,580.00
$4,219,230.00
13
Liabilities and Stockholders’ Equity
14
Accounts payable (merchandise...
The comparative balance sheet of Whitman Co. at December 31, 2016 and 2015, is as follows:1Dec....
The comparative balance sheet of Whitman Co. at December 31,
2016 and 2015, is as follows:1Dec. 31, 2016Dec. 31, 2015 2 Assets 3
Cash $918,790.00 $964,070.00 4 Accounts receivable (net)
828,170.00 761,040.00 5 Inventories 1,268,620.00 1,163,480.00 6
Prepaid expenses 29,330.00 34,930.00 7 Land 316,340.00 480,430.00
Buildings 1,461,710.00 900,600.00 9 Accumulated
depreciation-buildings (408,700.00) (382,020.00) 10 Equipment
511,330.00 455,280.00 11 Accumulated depreciation-equipment
(140,790.00) (158,240.00) 12 Total assets $4,784,800.00
$4,219,570.00 13 Liabilities and Stockholders’ Equity 14 Accounts
payable (merchandise creditors) $922,480.00 $959,030.00 15...
The equity sections from Hovo Corporation’s 2016 and 2017 balance sheets follow. Stockholders’ Equity (December 31,...
The equity sections from Hovo Corporation’s 2016 and 2017
balance sheets follow.
Stockholders’ Equity (December 31, 2016)
Common stock—$20 par value, 30,000 shares authorized,
17,000 shares issued and outstanding . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . $340,000
Paid-in capital in excess of par value, common stock . . . . . . .
. . . ....
The comparative balance sheet of Cromme Inc. for December 31, 2016 and 2015, is shown as...
The comparative balance sheet of Cromme Inc. for December 31,
2016 and 2015, is shown as follows:
1
Dec. 31, 2016
Dec. 31, 2015
2
Assets
3
Cash
$625,680.00
$586,230.00
4
Accounts receivable (net)
228,100.00
208,850.00
5
Inventories
640,910.00
617,650.00
6
Investments
0.00
240,620.00
7
Land
328,090.00
0.00
8
Equipment
704,540.00
553,320.00
9
Accumulated depreciation-equipment
(166,310.00)
(147,840.00)
10
Total assets
$2,361,010.00
$2,058,830.00
11
Liabilities and Stockholders’ Equity
12
Accounts payable (merchandise creditors)
$425,280.00
$404,550.00
13
Accrued expenses payable (operating expenses)...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- Why does a particular codon represent only one specific amino acid?
- Write a function template sort that takes two references to generic objects and switches them if...
- What 2 things happen to the melting point of a solid when an impurity is present?
- How Can Hominin Evolution be characterized as " mosaic evolution" Use examples of species from the...
- Absorption and Variable Costing Income Statements for Two Months and Analysis During the first month of...
- Mobile and wireless devices are being increasingly used in the Business Administration and Management Industry. write...
- What are the options that might be considered in relation to introducing flexible work practices? What...
ADVERTISEMENT