Partridge Purchased a 60% Interest in Sparrow on January 1

question 4

Multiple Choice

Partridge purchased a 60% interest in Sparrow on January 1, 2016, for $240,000.At the time of the purchase, Sparrow had the following stockholders' equity:
$$\begin{array} { l r } \text { Common stock ( } \$ 10 \text { par) } & \$ 80,000 \\\text { Retained earnings } & \underline { 120,000 } \\\text { Total stockholders' equity } & \$ 200,000\end{array}$$
Any excess is attributable to equipment with a 10-year life.On January 1, 2016, the retained earnings of Sparrow was $175,000.During the first 6 months of 2016, $25,000 was earned by Sparrow.The entire investment was sold for $300,000 on July 1, 2016.The gain (loss) was ____.

• A)$87,000
• B)$78,000
• C)$12,000
• D)$60,000

Appreciate the material science aspect of combining different metals in suspension systems to prevent corrosion.

Know the technical specifications and operational characteristics related to truck suspension systems, such as air pressure settings.

Distinguish between various types of leaf springs and their characteristics in truck suspensions.

Understand the sources and types of chassis oscillations and how they can affect vehicle suspension.

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Definitions:

Net Income

The total profit of a company after all expenses and taxes have been deducted from revenue.

Dividends

Payments made by a corporation to its shareholder members, typically in the form of cash or additional shares.

Depreciation Expense

A method to allocate the cost of a tangible asset over its useful life.

Consolidated Income Statement

A financial statement that combines the income statements of a parent company and its subsidiaries, presenting the financial performance of the entire group as a single entity.