ABC IncAcquired 40% of the Voting Shares of DEF Inc

question 58

Multiple Choice

ABC Inc.acquired 40% of the voting shares of DEF Inc.for $200,000 on January 1,2001.On that date,DEF's Common Shares and Retained Earnings were worth $240,000 and $60,000 respectively.On that date,DEF's Book Values approximated their Fair Values except for DEF's Inventory,which had a market value $50,000 higher than book value,and DEF's Plant & Equipment,which was said to have a market value that was $80,000 higher than its book value.The inventory was subsequently sold to outsiders during the year.The Plant and Equipment had a remaining useful life of ten years from the acquisition date.During the year,DEF earned net income and paid Dividends in the amount of $100,000 and $10,000,respectively.
-What would be the carrying value of ABC's Investment in DEF on January 31,2001?

• A)$200,000
• B)$300,000
• C)$290,000
• D)$212,800

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Definitions:

Indiscriminable Contingencies

Situations in which individuals cannot predict when their behavior will be reinforced, often leading to more consistent behaviors.

Response Maintenance

The continuation of a learned behavior after the original conditions for learning are removed or not present.

Social Interaction

The process by which individuals act and react to those around them, critical for the development of social skills and relationships.

Discriminative Stimuli

Environmental cues or signals that indicate the availability of reinforcement or punishment, guiding behavior.