P Corporation Acquired a 60% Interest in S Corporation on January

question 7

Multiple Choice

P Corporation acquired a 60% interest in S Corporation on January 1, 2014, at book value equal to fair value.During 2014, P sold merchandise that cost $135,000 to S for $189,000.One-third of this merchandise remained in S's inventory at December 31, 2014.S reported net income of $120,000 for 2014.P's income from S for 2014 is:

• A)$36,000.
• B)$50,400.
• C)$54,000.
• D)$61,200.

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Definitions:

Senior Executive Turnover

The rate at which top management personnel leave an organization, either voluntarily or involuntarily, and are replaced.

Succession Management

The process of identifying and developing internal people with the potential to fill key business leadership positions within the company.

Replacement Planning

The process of identifying and preparing suitable employees to replace key positions within an organization in case of employee turnover.

Mentoring

A personal developmental relationship in which a more experienced or knowledgeable person helps to guide a less experienced or knowledgeable person.