Question Details

Belden acquires 30 percent of the outstanding voting shares of Sheffield on January 1, 2017, for $408,000, which gives Belden the ability to...


Answer download
More Details:

Belden acquires 30 percent of the outstanding voting shares of Sheffield on January 1, 2017, for $408,000, which gives Belden the ability to significantly influence Sheffield. Sheffield has a net book value of $1,260,000 at January 1, 2017. Sheffield's asset and liability accounts showed carrying amounts considered equal to fair values except for a copyright whose value accounted for Belden's entire excess cost over its share of Sheffield’s book value in its 30 percent purchase. The copyright had a remaining life of 16 years at January 1, 2017.

     Sheffield reported net income of $283,000 in 2017 and $364,000 of net income during 2018. Dividends of $111,000 and $128,000 are declared and paid in 2017 and 2018, respectively. Belden uses the equity method.

1.

How much income would Belden report for 2017 and 2018 in connection with the company's investment in Sheffield?


2.

If Belden sells its entire investment in Sheffield on January 1, 2019, for $640,000 cash, what is the impact on Belden's income?


3. Assume that Belden sells inventory to Sheffield during 2017 and 2018 as follows:

 

   Year Cost to
Belden
Price to
Sheffield
Year-End Balance
(at Transfer Price)
   2017 $18,600       $31,000       $12,400 (sold in following year)    
   2018 24,600       41,000       24,600 (sold in following year)    

 

What amount of equity income should Belden recognize for the year 2018?


 


Solution details:
STATUS
Answered
QUALITY
Approved
ANSWER RATING

This question was answered on: Dec 18, 2020

PRICE: $18.50

Solution~00031148233869.zip (25.37 KB)

Buy this answer for only: $18.50

This attachment is locked

We have a ready expert answer for this paper which you can use for in-depth understanding, research editing or paraphrasing. You can buy it or order for a fresh, original and plagiarism-free copy (Deadline assured. Flexible pricing. TurnItIn Report provided)

Pay using PayPal (No PayPal account Required) or your credit card . All your purchases are securely protected by .
SiteLock

About this Question

STATUS

Answered

QUALITY

Approved

DATE ANSWERED

Dec 18, 2020

EXPERT

Tutor

ANSWER RATING

GET INSTANT HELP/h4>

We have top-notch tutors who can do your essay/homework for you at a reasonable cost and then you can simply use that essay as a template to build your own arguments.

You can also use these solutions:

  • As a reference for in-depth understanding of the subject.
  • As a source of ideas / reasoning for your own research (if properly referenced)
  • For editing and paraphrasing (check your institution's definition of plagiarism and recommended paraphrase).
This we believe is a better way of understanding a problem and makes use of the efficiency of time of the student.

NEW ASSIGNMENT HELP?

Order New Solution. Quick Turnaround

Click on the button below in order to Order for a New, Original and High-Quality Essay Solutions. New orders are original solutions and precise to your writing instruction requirements. Place a New Order using the button below.

WE GUARANTEE, THAT YOUR PAPER WILL BE WRITTEN FROM SCRATCH AND WITHIN YOUR SET DEADLINE.

Order Now