Chain Co Owned All of the Voting Common Stock of Shannon

question 57

Multiple Choice

Chain Co. owned all of the voting common stock of Shannon Corp. The corporations' balance sheets dated December 31, 2010, include the following balances for land: for Chain--$416,000, and for Shannon--$256,000. On the original date of acquisition, the book value of Shannon's land was equal to its fair value. On April 4, 2011, Chain sold to Shannon a parcel of land with a book value of $65,000. The selling price was $83,000. There were no other transactions which affected the companies' land accounts during 2010. What is the consolidated balance for land on the 2011 balance sheet?

• A) $672,000.
• B) $690,000.
• C) $755,000.
• D) $737,000.
• E) $654,000.

---

Definitions:

Lye

Lye refers to a strong alkaline solution, particularly of sodium hydroxide (NaOH) or potassium hydroxide (KOH), used in cleaning, soap making, and food preparation.

pH

A scale that measures the acidity or alkalinity of a solution, where 7 is neutral, values below 7 are acidic, and values above 7 are alkaline.

Mathematical Relationship

A connection between two or more variables or quantities, often expressed using equations or formulas.

pH

A scale used to specify the acidity or basicity of an aqueous solution, ranging from 0 (acidic) to 14 (basic).