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

question 16

Multiple Choice

Use the following information to answer the question(s) below.
On January 1,2011,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 1,2011.There are no book value/fair value differentials.
-Assume Salter's net income for 2011 is $220,000.No dividends are declared or paid in 2011.What is the change in Pardy's Investment in Salter for the year ending December 31,2011?

• A)$ 84,000
• B)$119,000
• C)$154,000
• D)$189,000

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Definitions:

Driving Torque

The force that causes rotation in a mechanical system, typically generated by an engine or motor.

Operating Quadrants

The four potential modes of operation for a drive or motor, determined by the direction of torque and rotation or direction of current and voltage.

Torque

A measure of the force that can cause an object to rotate about an axis. It is a major consideration in machine design and operation.

Rotation

The act or process of moving or turning around a central axis or point.