Question;1. Assuming;no impairment in value prior to transfer, assets transferred by a parent;company to another entity it has created should be recorded by the newly;created entity at the assets;A. cost to the parent company.;B. book value on the parent company's books at the date of transfer.;C. fair value at the date of transfer.;D. fair value of consideration exchanged by the newly created entity.;2. Given;the increased development of complex business structures, which of the;following regulators is responsible for the continued usefulness of accounting;reports?;A. Securities and Exchange Commission (SEC);B. Public Company Accounting Oversight Board (PCAOB);C. Financial Accounting Standards Board (FASB);D. All of the above;3. A;business combination in which the acquired company's assets and liabilities are;combined with those of the acquiring company into a single entity is defined;as;A. Stock acquisition;B. Leveraged buyout;C. Statutory Merger;D. Reverse statutory rollup;4. In;which of the following situations do accounting standards not require that the;financial statements of the parent and subsidiary be consolidated?;A. A corporation creates a new 100 percent owned subsidiary;B. A corporation purchases 90 percent of the voting stock of another;company;C. A corporation has both control and majority ownership of an;unincorporated company;D. A corporation owns less-than a controlling interest in an unincorporated;company;In;order to reduce the risk associated with a new line of business, Conservative;Corporation established Spin Company as a wholly owned subsidiary. It;transferred assets and accounts payable to Spin in exchange for its common stock.;Spin recorded the following entry when the transaction occurred;5. Based;on the preceding information, what number of shares of $7 par value stock did;Spin issue to Conservative?;A. 10,000;B. 7,000;C. 8,000;D. 25,000;6. Based;on the preceding information, what was Conservative's book value of assets;transferred to Spin Company?;A. $243,000;B. $263,000;C. $221,000;D. $201,000;7. Based;on the preceding information, what amount did Conservative report as its;investment in Spin after the transfer of assets and liabilities?;A. $181,000;B. $221,000;C. $263,000;D. $243,000;8. Based;on the preceding information, immediately after the transfer;A. Conservative's total assets decreased by $23,000.;B. Conservative's total assets decreased by $20,000.;C. Conservative's total assets increased by $56,000.;D. Conservative's total assets remained the same.;During;its inception, Devon Company purchased land for $100,000 and a building for;$180,000. After exactly 3 years, it transferred these assets and cash of;$50,000 to a newly created subsidiary, Regan Company, in exchange for 15,000;shares of Regan's $10 par value stock. Devon uses straight-line depreciation.;Useful life for the building is 30 years, with zero residual value. An;appraisal revealed that the building has a fair value of $200,000.;9. Based;on the information provided, at the time of the transfer, Regan Company should;record;A. Building at $180,000 and no accumulated depreciation.;B. Building at $162,000 and no accumulated depreciation.;C. Building at $200,000 and accumulated depreciation of $24,000.;D. Building at $180,000 and accumulated depreciation of $18,000.;10. Based;on the information provided, what amount would be reported by Devon Company as;investment in Regan Company common stock?;A. $312,000;B. $180,000;C. $330,000;D. $150,000;11. Based;on the preceding information, Regan Company will report;A. additional paid-in capital of $0.;B. additional paid-in capital of $150,000.;C. additional paid-in capital of $162,000.;D. additional paid-in capital of $180,000.
Paper#44331 | Written in 18-Jul-2015Price : $22