ABC, a Holder of a $400,000 XYZ Inc

question 29

Multiple Choice

ABC, a holder of a $400,000 XYZ Inc. bond, collected the interest due on June 30, 20X8, and then sold the bond to DEF Inc. for $365,000. On that date the bond issuer, XYZ, a 90 percent owner of DEF, had a $450,000 carrying amount for this bond.
-Based on the information given above,what was the effect of DEF's purchase of XYZ's bond on the noncontrolling interest amount reported in XYZ's June 30,20X8,consolidated balance sheet?

• A) No effect
• B) $35,000 increase
• C) $8,500 decrease
• D) $8,500 increase

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Definitions:

Liberty

The condition in society where one faces no oppressive limitations from authorities on their lifestyle, conduct, or political stances.

Latin American Nations

Countries in the Americas where Romance languages (predominantly Spanish and Portuguese) are spoken, sharing related cultures and historical ties.

Indians

Term historically used to refer to the indigenous peoples of the Americas; now considered outdated and replaced with "Native Americans" or "American Indians."

Free Blacks

African Americans who were not enslaved before the abolition of slavery, living in both the Northern and Southern United States.