Exacto Company reported the following net income and dividends for the years indicated:

Parent Company and Consolidated Balances

Exacto Company reported the following net income and dividends for the years indicated:

Year

Net Income

Dividends

20X5

35,000

12,000

20X6

45,000

20,000

20X7

30,000

14,000

True Corporation acquired 75 percent of Exacto's common stock on January 1, 20X5. On that date, the fair value of Exacto's net assets was equal to the book value. True uses the equity method in accounting for its ownership in Exacto and reported a balance of $259,800 in its investment account on December 31, 20X7.

Required

a. What amount did True pay when it purchased Exacto's shares?

b. What was the fair value of Exacto's net assets on January 1, 20X5?

c. What amount was assigned to the NCI shareholders on January 1, 20X5?

d. What amount will be assigned to the NCI shareholders in the consolidated balance sheet prepared at December 31, 20X7?

"Is this question part of your assignment? We can help"

ORDER NOW

0 replies

Leave a Reply

Want to join the discussion?
Feel free to contribute!

Leave a Reply

Your email address will not be published. Required fields are marked *