The Following Information Pertains to Questions

question 58

Multiple Choice

The following information pertains to questions
Find Corp.is a joint venture in which Seek Inc.has a 20% interest.Seek uses the equity method to account for its investment but has yet to make any journal entries for 2010.The financial statements of both companies are shown below on December 31,2010. During 2010,Seek sold merchandise totaling $120,000 to Find and recorded a gross profit of 50% on these sales.At the end of 2010,Find's inventory contained $30,000 worth of merchandise purchased from Seek.Find also owed $50,000 to find at the end of 2010.
Seek shall use the proportionate consolidation method (current Canadian GAAP) to report its investment in Find Corp.for 2010.Both companies are subject to 40% tax rate.
-What is the amount of Consolidated Retained Earnings for 2010?

• A)$340,000
• B)$368,000
• C)$376,000
• D)$558,000

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Definitions:

Economic Theory

A set of principles and frameworks used to understand, explain, and predict how economies operate and how economic agents interact.

Religious Values

Principles and moral standards shaped by religious beliefs that influence individuals' behavior and choices.

Corner Offices

Offices located at the corner of a building, often implying a prestigious or desirable location typically occupied by senior executives.

Economic Concept

A theoretical idea or principle that forms the basis of economic analysis and understanding, such as supply and demand.