Bailey, Inc., Buys 60 Percent Of The Outstanding s

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1. Bailey, Inc., buys 60 percent of the outstanding stock of Luebs, Inc., in an acquisition that resulted in the recognition of goodwill. Luebs owns a piece of land that cost $200,000 but was worth $500,000 at the acquisition date. What value should be attributed to this land in a consolidated balance sheet at the date of takeover? a. $120,000. b. $300,000. c. $380,000. d. $500,000. (Hoyle, Joe Ben. Fundamentals of Advanced Accounting with Dynamic Accounting PowerWeband CPA Success SG Coupon, 3rd Edition. McGraw-Hill Learning Solutions, 2009. p. 180). <vbk:0077589270#outline(4.9.1.4)> 4. On January 1, 2009, Turner, Inc., reports net assets of $480,000 although a building (with a 10-year life) having a book value of $260,000 is now worth $300,000. Plaster Corporation pays $540,000 on that date for a 90 percent ownership in Turner. On December 31, 2011, Turner reports a Building account of $182,000 and Plaster reports a Building account of $510,000. What is the consolidated balance of the Building account? a. $720,000. b. $724,000. c. $780,000. d. $810,000. (Hoyle, Joe Ben. Fundamentals of Advanced Accounting with Dynamic Accounting PowerWeband CPA Success SG Coupon, 3rd Edition. McGraw-Hill Learning Solutions, 2009. pp. 180 - 181). <vbk:0077589270#outline(4.9.1.4)> 8. James Company acquired 85 percent of Mark-Right Company on April 1. On its December 31, consolidated income statement, how should James account for Mark-Right's revenues and expenses that occurred before April 1. a. Include 100 percent of Mark-Right's revenues and expenses and deduct the preacquisition portion as noncontrolling interest in net income. b. Exclude 100 percent of the preacquisition revenues and 100 percent of the preacquisition expenses from their respective consolidated totals. c. Exclude 15 percent of the preacquisition revenues and 15 percent of the

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