REFERENCE: Ref.06_12 On January 1,2009,Harrison Corporation Spent $2,600,000 to Acquire Control Over

question 68

Multiple Choice

REFERENCE: Ref.06_12
On January 1,2009,Harrison Corporation spent $2,600,000 to acquire control over Involved,Inc.This price was based on paying $750,000 for 30 percent of Involved's preferred stock,and $1,850,000 for 80 percent of its outstanding common stock.As of the date of the acquisition,Involved's stockholders' equity accounts were as follows:
-Johnson,Inc.owns control over Kaspar,Inc.Johnson reports sales of $400,000 during 2009 while Kaspar reports $250,000.Kaspar transferred inventory during 2009 to Johnson at a price of $50,000.On December 31,2009,30 percent of the transferred goods are still in Johnson's inventory.Consolidated accounts receivable on January 1,2009 was $120,000,and on December 31,2009 is $130,000.Johnson uses the direct approach in preparing the statement of cash flows.How much is cash collected from customers on the consolidated statement of cash flows?

• A)$590,000.
• B)$610,000.
• C)$625,000.
• D)$635,000.
• E)$650,000.

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Definitions:

DNA Methylation

A biochemical process involving the addition of a methyl group to the DNA molecule, often affecting gene expression and cellular function.

Gene Expression

The process by which information from a gene is used to synthesize functional gene products such as proteins, leading to the manifestation of the gene's effects.

Eukaryotes

Living beings whose cells are characterized by having a nucleus and additional organelles, all of which are surrounded by membranes.

Proteolytic Processing

The enzymatic breakdown of proteins into smaller polypeptides or amino acids, often for activation or degradation of the protein.