Carnes Co Decided to Use the Partial Equity Method to Account

question 19

Essay

Carnes Co. decided to use the partial equity method to account for its investment in Domino Corp. An unamortized trademark associated with the acquisition was $30,000, and Carnes decided to amortize the trademark over ten years. For 2011, Carnes' Equity in Subsidiary Earnings was $78,000.
Required:
What balance would have been in the Equity in Subsidiary Earnings account if Carnes had used equity accounting?

---

Definitions:

Purchaser

An individual or entity that buys goods or services.

Quality of Goods

The degree to which goods meet the specified or implied criteria, often assessed in terms of durability, reliability, and performance.

Holder in Due Course

A party that has acquired a negotiable instrument in good faith and for value, and thus has certain protections against defenses and claims that could be asserted against the original payee.

Negotiable Instrument

A written document guaranteeing the payment of a specific amount of money, either on demand or at a set time, with the payer named on the document.