The Net Incomes for Parent and Sub Inc for the Year

question 45

Multiple Choice

The Net Incomes for Parent and Sub Inc for the year ended July 31, 2012 were $120,000 and $60,000 respectively. Assuming the Entity Theory was applied, what would be the amount of Goodwill appearing on the Consolidated Balance Sheet on the Date of acquisition, assuming once again that Parent purchased 80% of Sub Inc. for $180,000?

• A) $88,000
• B) $130,000
• C) $137,000
• D) $138,000

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Definitions:

Convenience Sampling

A non-probability sampling method where participants are selected based on availability and willingness to take part, rather than random selection.

Researcher Convenience

A methodological approach where the ease of research execution for the researcher, rather than methodological rigor, determines key decisions.

Stratified Random Sampling

A method of sampling that involves dividing a population into strata, or groups, and then selecting random samples from each stratum to ensure representation across the population.

Sampling

The process of selecting a subset of individuals from a population to represent the whole, used in statistical analysis and research studies.