Understanding consolidated balances Assume an investor acquired 100% of the voting common stock of an investee on January 1, 2015 in a transaction that qualifies as a business combination. As a result of the acquisition, the investor recognized no goodwill and no bargain purchase gain in the post-acquisition consolidated financial statements (i.e., all of the resulting Acquisition Accounting Premium relates to identifiable net assets). The investor uses the equity method to account for its pre-consolidation investment in the investee. In addition, there are no intercompany transactions between the investor and investee. The following summarized pre-consolidation financial statement information is for the year ending December 31, 2022: What amount of "net income" will be reported in the consolidated income statement for the year ending December 31 , 2022 ?
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Understanding consolidated balances Assume an investor acquired 100- o.docx
1. Understanding consolidated balances Assume an investor acquired 100% of the voting common
stock of an investee on January 1, 2015 in a transaction that qualifies as a business combination.
As a result of the acquisition, the investor recognized no goodwill and no bargain purchase gain
in the post-acquisition consolidated financial statements (i.e., all of the resulting Acquisition
Accounting Premium relates to identifiable net assets). The investor uses the equity method to
account for its pre-consolidation investment in the investee. In addition, there are no
intercompany transactions between the investor and investee. The following summarized pre-
consolidation financial statement information is for the year ending December 31, 2022: What
amount of "net income" will be reported in the consolidated income statement for the year
ending December 31 , 2022 ?
