Question & Answer: ing 11,700 shares of $10 par value common stock. Haynes's shares h…..

Haynes, Inc., obtained 100 percent of Turner Companys common stock on January 1, 2014, by issuing 11,700 shares of $10 par value common stock. Hayness shares had a $15 per share fair value. On that date, Turner reported a net book value of $134,050. However, its equipment (with a five-year remaining life) was undervalued by $7,550 in the companys accounting records. Also, Turner had developed a customer list with an assessed value of $33,900, although no value had been recorded on Turners books. The customer list had an estimated remaining useful life of 10 years. The following figures come from the individual accounting records of these two companies as of December 31, 2014: Revenues Expenses Investment income Dividends declared $ (730,000) 493,000 Not $(240,000) 125,000 120,000 50,000 The following figures come from the individual accounting records of these two companies as of December 31, 2015 $(310,000) 162,100 Revenues Expenses Investment income Dividends declared Equipment $(913,000) 519,300 Not 140,000 572,000 30,000 383,000 a. What balance does Hayness Investment in Turner account show on December 31, 2015, when the equity method is applied? 15 18 19
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Haynes, Inc., obtained 100 percent of Turner Company’s common stock on January 1, 2014, by issuing 11,700 shares of $10 par value common stock. Haynes’s shares had a $15 per share fair value. On that date, Turner reported a net book value of $134,050. However, its equipment (with a five-year remaining life) was undervalued by $7,550 in the company’s accounting records. Also, Turner had developed a customer list with an assessed value of $33,900, although no value had been recorded on Turner’s books. The customer list had an estimated remaining useful life of 10 years. The following figures come from the individual accounting records of these two companies as of December 31, 2014: Revenues Expenses Investment income Dividends declared $ (730,000) 493,000 Not $(240,000) 125,000 120,000 50,000 The following figures come from the individual accounting records of these two companies as of December 31, 2015 $(310,000) 162,100 Revenues Expenses Investment income Dividends declared Equipment $(913,000) 519,300 Not 140,000 572,000 30,000 383,000 a. What balance does Haynes’s Investment in Turner account show on December 31, 2015, when the equity method is applied? 15 18 19

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Question & Answer: ing 11,700 shares of $10 par value common stock. Haynes's shares h..... 1

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