When applying for credit, lenders will consider your:
A) Capacity
B) Collateral
C) Character
D) All of the above
E) None of the above
C
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Mickelson Company acquired an 80% interest in Footjoy on January 1, Year 1, for $1,200,000. The book value of Footjoy's identifiable net assets at that date was $900,000. One depreciable asset (10-year life) had a fair value that exceeded its book value by $100,000. Footjoy reported $60,000 of net income in Year 1 and paid $40,000 in dividends. What was the noncontrolling interest in NET ASSETS as of the date of acquisition, January 1, YEAR 1?
a. $240,000 b. $180,000 c. $300,000 d. $0
A plant site donated by a township to a manufacturer that plans to open a new factory should be recorded on the manufacturer's books at
a. the nominal cost of taking title to it. b. its fair value. c. one dollar (since the site cost nothing but should be included in the balance sheet). d. the value assigned to it by the company's directors.