Bassett Inc

question 32

Multiple Choice

Bassett Inc. acquired all of the outstanding common stock of Brinkman Corp. on January 1, 2019, for $422,000. Equipment with a ten-year life was undervalued on Brinkman's financial records by $48,000. Brinkman also owned an unrecorded customer list with an assessed fair value of $71,000 and an estimated remaining life of five years.Brinkman earned reported net income of $185,000 in 2019 and $226,000 in 2020. Dividends of $75,000 were paid in each of these two years. Selected account balances as of December 31, 2021, for the two companies follow. If the partial equity method had been applied, what was 2021 consolidated net income?

• A) $260,000.
• B) $620,000.
• C) $861,000.
• D) $880,000.
• E) $1,291,000.

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Definitions:

Offspring

The product of reproduction of a new organism produced by one or more parents.

Age Structure

The number and proportion of people at each age in a population. Age structure diagrams represent the number of males and females at each age, from birth to death, in the population.

Iteroparous

Describes organisms that can reproduce multiple times over their lifetimes, as opposed to only once.

Invertebrates

Multicellular organisms that lack a vertebral column or backbone.