REFERENCE: Ref.01_15 Cayman Inc.bought 30% of Maya Company on January 1,2008 for 1,2008

question 80

Multiple Choice

REFERENCE: Ref.01_15
Cayman Inc.bought 30% of Maya Company on January 1,2008 for $450,000.The equity method of accounting was used.The book value and fair value of the net assets of Maya on that date were $1,500,000.Maya began supplying inventory to Cayman as follows:
Maya reported net income of $100,000 in 2008 and $120,000 in 2009 while paying $40,000 in dividends each year.
-Which of the following results in a decrease in the Equity in Investee Income account when applying the equity method?

• A)Dividends paid by the investor.
• B)Net income of the investee.
• C)Unrealized gain on intercompany inventory transfers for the current year.
• D)Unrealized gain on intercompany inventory transfers for the prior year.
• E)Extraordinary gain of the investee.

Diagram and explain the hydrologic cycle, including its major processes and components.

Understand the principles of physical development in children, including proximodistal and cephalocaudal patterns.

Identify the significance of nutrition and environment on physical growth in children.

Recognize patterns of growth including the timing and sequence of developmental milestones.

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Definitions:

Vertical Merger

A merger between two or more companies operating at different levels within an industry's supply chain, aimed at creating more synergies or reducing costs.

Competitor

A person or entity that competes with another, particularly in business or in the offering of goods and services.

Capital Structure

Capital structure is the mixture of a company's long-term debt, specific short-term debt, common equity, and preferred equity which finance its overall operations and growth.

Leverage

Taking on debt to magnify the prospective profits of an investing activity.