On January 1, 2013, Pride, Inc

question 13

Multiple Choice

On January 1, 2013, Pride, Inc. acquired 80% of the outstanding voting common stock of Strong Corp. for $364,000. There is no active market for Strong's stock. Of this payment, $28,000 was allocated to equipment (with a five-year life) that had been undervalued on Strong's books by $35,000. Any remaining excess was attributable to goodwill which has not been impaired.
As of December 31, 2013, before preparing the consolidated worksheet, the financial statements appeared as follows:
During 2013, Pride bought inventory for $112,000 and sold it to Strong for $140,000. Only half of this purchase had been paid for by Strong by the end of the year. 60% of these goods were still in the company's possession on December 31, 2013.
What is the total of consolidated revenues?

• A) $700,000.
• B) $644,000.
• C) $588,000.
• D) $560,000.
• E) $840,000.

---

Definitions:

Higher-Order Conditioning

A process in classical conditioning by which a stimulus that's associated with a conditioned stimulus also becomes capable of eliciting a conditioned response.

Successive Approximations

A method used in behavior modification that rewards behaviors that progressively get closer to the desired behavior.

Intermittent Reinforcement

A conditioning schedule where a response is only sometimes reinforced, leading to more resistant and persistent behavior.

Faster Extinction

The accelerated reduction or loss of conditioned responses, typically in the context of behavioral psychology.