If Watkins Pays $400,000 in Cash for Glen, What Amount

question 12

Multiple Choice

If Watkins pays $400,000 in cash for Glen, what amount would be represented as the subsidiary's Building in a consolidation at December 31, 2019, assuming the book value of the building at that date is still $200,000?

• A) $200,000.
• B) $285,000.
• C) $260,000.
• D) $268,000.
• E) $300,000.

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Definitions:

Lavas

Magma that has been expelled from a volcanic vent and has solidified on the Earth's surface.

Magmas

Molten rock material beneath or within the Earth's crust, from which igneous rock is formed through cooling and solidification.

Mid-ocean Ridges

Underwater mountain ranges formed by plate tectonics, where new oceanic crust is created through volcanic activity along divergent plate boundaries.

Ocean Plates

Large pieces of the Earth's crust that move over the partially molten outer layer, specifically those under the oceans.