Paris, Inc

question 81

Multiple Choice

Paris, Inc. owns 80 percent of the voting stock of Stance, Inc. The excess total fair value over book value was $75,000. Stance holds 10 percent of the voting stock of Paris. The payment for that investment was in excess of book value and fair value by $15,000. Any excess fair value is assigned to trademarks to be amortized over a 10-year period. During the current year, Paris reported operating income of $200,000 and dividend income from Stance of $20,000. At the same time, Stance reported operating income of $40,000 and dividend income from Paris of $5,000.
-What is Paris' share of consolidated net income?

• A) $232,500.
• B) $225,000.
• C) $224,500.
• D) $226,000.
• E) $233,500.

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Definitions:

Capillaries

The smallest blood vessels in the body's circulatory system, facilitating the exchange of water, oxygen, carbon dioxide, and other nutrients between blood and tissues.

Pulse

The rhythmic throbbing of the arteries as blood is propelled through them, typically palpable at body sites where arteries are close to the skin surface.

Diastole

Relaxation of the heart chambers, during which they fill with blood; usually refers to ventricular relaxation.

Ejection of Blood

is the process during which the heart pumps blood out of the ventricles into the aorta and pulmonary artery during systole.