What Would Be Errant's Journal Entry to Record the Amortization

question 56

Multiple Choice

What would be Errant's journal entry to record the amortization of the acquisition differential (excluding any goodwill impairment) on December 31, 2018? (Assume that any difference between the fair values and book values of the equipment, trademark and bonds payable would all be amortized over 10 years.)

• A)
• \[\begin{array} { | l | l | l | }
• \hline & \text { Debit } & \text { Credit } \\
• \hline \text { Equity method inc ome } & \$ 18,800 & \\
• \hline \text { investment in Grub } & & \$ 18,800 \\
• \hline
• \end{array}\]
• B)
• \[\begin{array} { | l | l | l | }
• \hline & \text { Debit } & \text { Credit } \\
• \hline \text { Equity method inc ome } & \$ 16,000 & \\
• \hline \text { imestment in Grub } & & \$ 16,000 \\
• \hline
• \end{array}\]
• C)
• \[\begin{array} { | l | l | l | }
• \hline & \text { Debit } & \text { Credit } \\
• \hline \text { Investment in Grub } & \$ 18,800 & \\
• \hline \text { Equity method inc ome } & & \$ 18,800 \\
• \hline
• \end{array}\]

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Definitions:

Jungle Unionism

A term that may refer to aggressive, unregulated union activities or tactics, often implying a lawless or survival-of-the-fittest approach. Since this term is less recognized and might be considered outdated or pejorative, a direct contemporary equivalent might not exist, but it often denotes aggressive labor activism.

Insurance Company

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Dues

Fees collected from members by unions or other organizations to fund operations, activities, and representational functions.

Ethical Framework

A structured set of principles and guidelines that inform decision-making and actions based on moral values, aiming to ensure fairness, justice, and respect in various contexts.