In January of 2011, Clyde Corporation Acquired 20% of the Outstanding

question 14

Multiple Choice

In January of 2011, Clyde Corporation acquired 20% of the outstanding voting common stock of Blake Company for $280,000. This investment enabled Clyde to exercise significant influence over Blake. The book value of the acquired shares was $210,000. The excess of cost over book value was attributed to an identifiable intangible asset that was undervalued on Blake's balance sheet and that had a remaining useful life of 10 years.
For the year ended December 31, 2011, Blake reported income of $63,000 and paid cash dividends of $14,000 on its common stock. What is the proper carrying value of Clyde's investment in Blake at December 31, 2011?

• A) $270,000
• B) $273,000
• C) $280,000
• D) $282,800

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The degree to which a test accurately measures what it intends to measure.

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A statistical measure that indicates the extent to which two variables fluctuate together, indicating the strength and direction of their relationship.