Beige Corporation Pays $500,000 to Acquire 40% of the Equity

question 82

Multiple Choice

Beige Corporation pays $500,000 to acquire 40% of the equity securities of Olive Technologies on May 5, 2015. Which of the following will be included in the journal entry to record this transaction?

• A)Long-term Investments-Trading Investments will be debited by $500,000.
• B)Long-term Investments-Olive Technologies will be debited by $500,000.
• C)Long-term Investments-Available-for-Sale will be debited by $500,000.
• D)Long-term Investments-Available-for-Sale will be credited by $500,000.

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Definitions:

Hammer

A tool typically used for hitting nails or breaking objects, consisting of a heavy head fixed to a long handle.

Anvil

In non-biological contexts, an anvil is a heavy iron block used in metalworking. In the context of the ear, it refers to the incus, a small anvil-shaped bone in the middle ear that helps transmit sound vibrations.

Stirrup

The stirrup, or stapes, is a small bone in the middle ear that plays a key role in the transmission of sound vibrations to the inner ear.

Middle Ear

A part of the ear between the eardrum and the inner ear, containing three small bones that help transmit sound.