Franklin Corporation Owns 90 Percent of the Outstanding Voting Stock

question 33

Multiple Choice

Franklin Corporation owns 90 percent of the outstanding voting stock of Georgia Company.On January 2,2007,Georgia sold 7 percent bonds payable with a $5,000,000 face value maturing January 2,2027 at a premium of $500,000.On January 1,2009,Franklin acquired 20 percent of these same bonds at 97.66.Both companies use the straight-line method of amortization.What adjustment should be made to Franklin's 2010 beginning Retained Earnings as a result of this bond acquisition?

• A)$107,100.
• B)$113,400.
• C)$119,700.
• D)$144,000.
• E)$152,000.

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Definitions:

Bulimia

Also known as Bulimia Nervosa, an eating disorder characterized by episodes of binge eating followed by behaviors to prevent weight gain, such as self-induced vomiting.

Uncontrollable Overeating

a compulsive urge to eat large amounts of food, often quickly, regardless of hunger levels or physical needs.

Obsessive-Compulsive Disorder

A disorder characterized by uncontrollable, recurring thoughts (obsessions) and behaviors (compulsions) that an individual feels the urge to repeat over and over.

Anorexia

A serious eating disorder characterized by an intense fear of gaining weight and a distorted body image, leading to self-starvation and excessive weight loss.