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    Economic Unit Concept.

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    When Jolt Co. acquired 75% of the common stock of Yelts Corp., Yelts owned land with a book value of $70,000 and a fair market value of $100,000.

    11. What amount should have been reported for the land on a consolidated balance sheet, assuming the economic unit concept was used?
    A) $ 70,000
    B) $ 75,000
    C) $ 85,000
    D) $ 92,500
    E) $100,000

    12. What amount should have been reported for the land on a consolidated balance sheet, assuming the proportionate consolidation concept was used?
    A) $ 70,000
    B) $ 75,000
    C) $ 85,000
    D) $ 92,500
    E) $100,000

    13. What amount should have been reported for the land on a consolidated balance sheet, assuming the parent company concept was used?
    A) $ 70,000
    B) $ 75,000
    C) $ 85,000
    D) $ 92,500
    E) $100,000

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    https://brainmass.com/business/finance/economic-unit-concept-107534

    Solution Preview

    The economic unit concept consolidates assets at fair market value. Thus, answer to 11 is E.
    The proportionate ...

    Solution Summary

    The solution looks at economic unit concepts.

    $2.19

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