PLZ do all 5 question otherwise don\'t try to do else i will not rate it if you

Question

PLZ do all 5 question otherwise don't try to do else i will not rate it

if you will do all 5 MCQ i will give 100%rating and good comments

and answer correctly

BakerTony Inc. purchased 25% of the common stock of FloydCompany on January 1 for $150. The contributed capital bal of FloydCompany at this date was $250 and the retained earnings balance was $350. During the year, net income of Floydompany was $120 and dividends declared were $40. BakerTony uses the equity method to account for the investn How much income from this investment will BakerTony show on its income statement for the year? O $0 $30 $20 O $120

Explanation / Answer

1. As the company uses Equity Method for Investment in Associates, any change in the value of investee should be recorded in the invetors Investment A/c without routing through Profit & Loss A/c.

a. (0$)

2. b. No Impact on Income Statement and Cash Flow from Operations.

3. The oxford Street is better because the cost in terms of present value is less than the cost of present value of prime street offer.

4. Cost of Goods Sold=Opening Inventory+Purchases-Closing Inventory

=$20,000+$90,000-$24,000

=86,000

5. Deprceciation=Cost-Salvage Value/Useful Life

$20,000=(Cost-$20,000)/25

$20,000*25=Cost-$20,000

Cost=$5,20,000

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