On January 3, 2011, Jenkins Corp

question 118

Essay

On January 3, 2011, Jenkins Corp. acquired 40% of the outstanding common stock of Bolivar Co. for $1,200,000. This acquisition gave Jenkins the ability to exercise significant influence over the investee. The book value of the acquired shares was $950,000. Any excess cost over the underlying book value was assigned to a patent that was undervalued on Bolivar's balance sheet. This patent has a remaining useful life of ten years. For the year ended December 31, 2011, Bolivar reported net income of $312,000 and paid cash dividends of $96,000.
Required:
Prepare a schedule to show the balance Jenkins should report as its Investment in Bolivar Co. at December 31, 2011.

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Definitions:

Andrew Jackson

The seventh President of the United States (1829–1837), known for his populist policies, but also for his role in the Indian Removal Act, which led to the Trail of Tears.

Fugitive Slaves

Escaped slaves seeking freedom from bondage, who were often subject to laws compelling their return to enslavement.

Transportation Infrastructure

The framework of facilities and systems that support the movement of people and goods, including roads, bridges, railways, ports, airports, and public transit.