The Nathan Company acquired all of the outstanding stock of Caleb Company on January 1, 2014 for P267,800 cash. Caleb had a book value of only P182,000 on that date. However, equipment (having an eight-year life) is undervalued by P52,000 on Caleb’s financial records. A building with a 20-year life was overvalued by P13,000. Subsequent to the acquisition, Caleb reported the following:

In accounting for this investment, Nathan has used the cost method. Selected accounts taken from the financial records of these two companies as of December 31, 2016, are as follows:

Required:

Determine the following account balances as of December 31, 2016.

1. Net Income Attributable to Equity Holders of the Parent
2. Non-controlling Interest in Net Income of Subsidiary
3. Consolidated Net Income
4. Consolidated Equipment (net)
5. Consolidated Buildings (net)
6. Consolidated Goodwill (net)
7. Consolidated Ordinary Shares
8. Consolidated Accumulated Profits

On July 1, 2016, Killearn Company acquired 120,000 of the outstanding shares of Shaun Company for $15 per share. This acquisition gave Killearn a 20 percent ownership of Shaun and allowed Killearn to significantly influence the investee's decisions.

As of July 1, 2016, the investee had assets with a book value of $7 million and liabilities of $148,000. At the time, Shaun held equipment appraised at $581,000 above book value; it was considered to have a seven-year remaining life with no salvage value. Shaun also held a copyright with a five-year remaining life on its books that was undervalued by $1,235,000. Any remaining excess cost was attributable to goodwill. Depreciation and amortization are computed using the straight-line method. Killearn applies the equity method for its investment in Shaun.

Shaun's policy is to declare and pay a $1 per share cash dividend every April 1 and October 1. Shaun's income, earned evenly throughout each year, was $566,000 in 2016, $593,400 in 2017, and $643,600 in 2018.

In addition, Killearn sold inventory costing $114,600 to Shaun for $191,000 during 2017. Shaun resold $123,500 of this inventory during 2017 and the remaining $67,500 during 2018.

Determine the equity income to be recognized by Killearn during each of these years.

Compute Killearn's investment in Shaun Company's balance as of December 31, 2018.

A. Equity Income 2016 __________

B. Equity Income 2017 __________

C. Equity Income 2018 __________

D. Investment in Sahun __________

14. The Anderson Company acquired 100,000 shares of the Beck Company on January 1, 2016, at $25 per share. Beck’s stock price on December 31, 2016, was $35 per share. During 2016, Beck declared and paid dividends of $1.50 per share and had earnings of $2.50 per share. Anderson Company accounted for its investment in Beck Company shares as subsequently measured at fair value through OCI. What was the net effect of investment in Beck Company shares on Anderson’s income statement for 2016?

1. $250,000.
2. $100,000.
3. $150,000.

Answer is c, why

K Company acquired 80 percent of the outstanding shares of Duo Company by paying $420,000 in cash. The fair value of Duo’s identifiable assets is $630,000, and the liabilities assumed by K Co. in this business combination are $205,000.

a. Please calculate the total amount of goodwill on the B/S this year. Also indicate the amount of goodwill that belongs to the noncontrolling interest account on B/S.

b. K Co. must conduct an impairment test of the goodwill related to the acquisition of Duo. The assets of Duo are the smallest group of assets that generate cash inflows, and it is a separate cash generating unit. K. Co estimated the following items:

Fair value less costs to sell is $ 370,000

Present value of future cash flows is $350,000

Please calculate the impairment loss that should be recorded on I/S.

On July 1, 2016, Killearn Company acquired 136,000 of the outstanding shares of Shaun Company for $15 per share. This acquisition gave Killearn a 25 percent ownership of Shaun and allowed Killearn to significantly influence the investee's decisions.

As of July 1, 2016, the investee had assets with a book value of $7 million and liabilities of $456,800. At the time, Shaun held equipment appraised at $319,200 above book value; it was considered to have a seven-year remaining life with no salvage value. Shaun also held a copyright with a five-year remaining life on its books that was undervalued by $980,000. Any remaining excess cost was attributable to goodwill. Depreciation and amortization are computed using the straight-line method. Killearn applies the equity method for its investment in Shaun.

Shaun's policy is to declare and pay a $1 per share cash dividend every April 1 and October 1. Shaun's income, earned evenly throughout each year, was $579,000 in 2016, $619,400 in 2017, and $675,200 in 2018.

In addition, Killearn sold inventory costing $111,000 to Shaun for $185,000 during 2017. Shaun resold $82,500 of this inventory during 2017 and the remaining $102,500 during 2018.

Determine the equity income to be recognized by Killearn during each of these years.

Compute Killearn's investment in Shaun Company's balance as of December 31, 2018

On July 1, 2016, Killearn Company acquired 142,000 of the outstanding shares of Shaun Company for $15 per share. This acquisition gave Killearn a 40 percent ownership of Shaun and allowed Killearn to significantly influence the investee's decisions.

As of July 1, 2016, the investee had assets with a book value of $5 million and liabilities of $890,000. At the time, Shaun held equipment appraised at $245,000 above book value; it was considered to have a seven-year remaining life with no salvage value. Shaun also held a copyright with a five-year remaining life on its books that was undervalued by $800,000. Any remaining excess cost was attributable to goodwill. Depreciation and amortization are computed using the straight-line method. Killearn applies the equity method for its investment in Shaun.

Shaun's policy is to declare and pay a $1 per share cash dividend every April 1 and October 1. Shaun's income, earned evenly throughout each year, was $614,000 in 2016, $654,600 in 2017, and $704,200 in 2018.

In addition, Killearn sold inventory costing $145,800 to Shaun for $243,000 during 2017. Shaun resold $102,000 of this inventory during 2017 and the remaining $141,000 during 2018.

1. Determine the equity income to be recognized by Killearn during each of these years.

2. Compute Killearn's investment in Shaun Company's balance as of December 31, 2018.

(For all requirements, enter your answers in whole dollars and not in millions.)

I have always been a firm believer in the saying "it's all about who you know." In the business world especially, this statement is proved true more times than not. An argument for why CEOs get paid too much is the inconsistency of compensation. "...it is reasonable to assume that the people who become CEOs because corporations offer $8 million per year, on average, more talented than the people who would become CEOs if corporations offered $1 million per year. But there are two reasons to think that they are not that much more talented, and so not worth the extra pay." I do agree with the argument that the CEO making $8 million a year isn't always more talented than a CEO making $1 million a year, but the CEO that is making $8 million had to go through the work to get that job. Whether they knew someone that got them into a very good position in order to acquire the job or not doesn't matter. There a lot of very bright people who are not making as much money as someone who is not as bright as them, even in the same line of work. People get much different opportunities to succeed than others. There is a stat that states a CEO on average makes 301 times the amount of a factory worker for that same company; I do believe that the CEO is not doing 301 times the amount of work as the factory worker nor that the CEO is actually working for all of that money; however, they still worked hard enough to get themselves into that position. So with me stating that I would say that no, CEOs are not making too much money. Their job is very important, and I would assume that along with that large compensation comes with much stress and timely work. Have any of you ever had a job where you were doing the same amount and kind of work as someone but making a significant less amount of money? Are you doing things now that will set you up for success or failure in the future?

Would like a detailed response to this

Please comment on what how you think, if at all, CSR changes when the company is not the US or when US companies deal with foreign companies. Does CSR have any impact on marketing? How so?

1. Scores on an MBA placement exam are reported to have a normal distribution with standard deviation 18. The exam officials stated that the average score for all students was 70. You take a random sample of 50 students and find their average score is 67. Use your data to estimate the mean score for all students taking the MBA placement exam -Verify your answer using calculations and show your work.

2. Students at the union want to estimate the average number of ounces of coffee in a cup. They take a random sample of 40 cups and find the mean is 5.2 ounces. Assume amount dispensed has a normal distribution and that the standard deviation is set at 0.24 ounces per cup. Find your best estimate for the average amount of coffee being dispensed by this machine. Verify your answer using calculations and show your work.