Required: 1. Assume no significant influence was acquired. How will the investment in Midlin Company be reflected in the balance sheet and income statement of Fair Company at year-end? Required information [The following information applies to the questions displayed below.] As a long-term investment, Fair Company purchased 20% of Midlin Company's 150,000 shares for $180,000 at the beginning of the reporting year of both companies. During the year, Midlin earned net income of $120,000 and distributed cash dividends of $0.30 per share. At year-end, the fair value of the shares is $187,500. Investments Dividend Revenue. Dividend Revenue Unrealized Holding Gain-OCI Investments Cash Answer is complete but not entirely correct. Balance Sheet (Partial) Investments Cash 2. Assume significant influence was acquired. How will the investment in Midlin Company be reflected in the balance sheet and income statement of Fair Company at year-end? Balance Sheet (Partial) $ $ $ $ Income Statement (Partial) 180,000 7,500X 10,800 x Income Statement (Partial) 9,000 7,500

Required: 1. Assume no significant influence was acquired. How will the investment in Midlin Company be reflected in the balance sheet and income statement of Fair Company at year-end? Required information [The following information applies to the questions displayed below.] As a long-term investment, Fair Company purchased 20% of Midlin Company's 150,000 shares for $180,000 at the beginning of the reporting year of both companies. During the year, Midlin earned net income of $120,000 and distributed cash dividends of $0.30 per share. At year-end, the fair value of the shares is $187,500. Investments Dividend Revenue. Dividend Revenue Unrealized Holding Gain-OCI Investments Cash Answer is complete but not entirely correct. Balance Sheet (Partial) Investments Cash 2. Assume significant influence was acquired. How will the investment in Midlin Company be reflected in the balance sheet and income statement of Fair Company at year-end? Balance Sheet (Partial) $ $ $ $ Income Statement (Partial) 180,000 7,500X 10,800 x Income Statement (Partial) 9,000 7,500

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter15: Contributed Capital

Section: Chapter Questions

Problem 1MC

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