Beesly Co Owned All of the Voting Common Stock of Halpert

question 11

Multiple Choice

Beesly Co. owned all of the voting common stock of Halpert Corp. The corporations' balance sheets dated December 31, 2020, include the following balances for land: -Beesly - $461,000, and -Halpert - $265,000. On the original date of acquisition, the book value of Halpert's land was equal to its fair value. On May 2, 2021, Beesly sold to Halpert a parcel of land with a book value of $75,000. The selling price was $88,000. There were no other transfers, which affected the companies' land accounts during 2020. What is the consolidated balance for land on the 2021 balance sheet?

• A) $713,000.
• B) $726,000.
• C) $739,000.
• D) $801,000.
• E) $814,000.

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Definitions:

Purely Competitive Firm

A market structure where firms are price takers and sell homogeneous products with many buyers and sellers, leading to perfect competition.

Economic Profit

The contrast between a company's overall receipts and its full charges, considering both palpable and inferred costs.

Long Run

A time period in economics during which all factors of production and costs are variable, allowing for all adjustments to be made to achieve an equilibrium.

Competitive Increasing-cost Industry

An industry in which the entry of new firms causes the input prices to increase, leading to upward-sloping supply curves for the firms.