On January 1,20X7,Server Company Purchased a Machine with an Expected

question 23

Multiple Choice

On January 1,20X7,Server Company purchased a machine with an expected economic life of five years.On January 1,20X9,Server sold the machine to Patron Corporation and recorded the following entry:
Patron Corporation holds 75 percent of Server's voting shares.Server reported net income of $50,000,and Patron reported income from its own operations of $100,000 for 20X9.There is no change in the estimated economic life of the equipment as a result of the intercorporate transfer.
-Based on the preceding information,income assigned to the noncontrolling interest in the 20X9 consolidated income statement will be:

• A)$12,000.
• B)$14,000.
• C)$12,500.
• D)$48,000.

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Definitions:

Variance

A statistical measure that represents the extent to which a set of numbers varies from the average of that set.

Probability

The measure or estimation of how likely it is that an event will occur, expressed as a number between 0 (impossible) and 1 (certain).

Crashing

A project management technique used to shorten the duration of a project by increasing resources for critical activities, typically at increased costs.

CPM Network

A project management tool that uses critical path method (CPM) to model tasks and activities in a project, showing the sequence and duration of each.