Use the Following Information to Answer the Question(s) Below

question 24

Multiple Choice

Use the following information to answer the question(s) below.

On January 1, 2014, Pardy Corporation acquired a 70% interest in the common stock of Salter Corporation for $7,000,000 when Salter's stockholders' equity was as follows:
There were no preferred dividends in arrears on January 1, 2014. There are no book value/fair value differentials.
-Salter has a 2014 net loss of $200,000.No dividends are declared or paid in 2014.What is the change in Pardy's Investment in Salter for the year ending December 31,2014?

• A)$50,000
• B)$70,000
• C)$140,000
• D)$210,000

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Definitions:

Symbolic Interactionism

A sociological perspective that analyzes society by studying the symbols and communication methods used by individuals to interpret and respond to their social environment.

Rational Choice Theory

Rational choice theory focuses on the way interacting people weigh the benefits and costs of interaction. According to rational choice theory, interacting people always try to maximize benefits and minimize costs.

Rational Choice Theory

A theoretical framework that suggests individuals make decisions based on the anticipated costs and benefits, aiming to maximize their advantage.

Social Interaction

The process by which individuals act and react in relation to others, forming the basis of social relationships.