Ames owns 100% of Nestlum, Inc. Although the Investment in Nestlum account has a balance of $596,000, the subsidiary's 12,000 shares have an underlying book value of only $40 per share. On Jan 1, 2009, Nestlum issues 3,000 new shares to the public for $50 per share. How does this transaction affect the Investment in Nestlum account?
a)It is not affected because the shares were sold to outside parties.
b) It should be increased by $24,000
c) It should be decreased by $119,200
d) It should be increased by $30,000
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