LaFevor Co

question 83

Multiple Choice

LaFevor Co. acquired 70% of the common stock of Dean Corp. on August 1, 2022. For 2022, Dean reported revenues of $960,000 and expenses of $780,000, all reflected evenly throughout the year. The annual amount of amortization related to this acquisition was $21,000.What is the effect of including Dean in consolidated net income for 2022?

• A) $8,750.
• B) $66,250.
• C) $75,000.
• D) $126,000.
• E) $159,000.

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Definitions:

Standardization

The process of establishing common standards within an industry to ensure that products and services are consistent and compatible.

Contract Manufacturer

A company hired to produce goods on behalf of another company, under the hiring company's brand name.

Flexible Manufacturing

The direction of machinery by computers to adapt to different versions of similar operations.