The following investment activities relate to Parade Corp. Parade has a December 31 year end. Year 1: January 2 December 31 December 31 Year 2: March 5 Parade Corp. paid $5,000,000 cash to acquire 400,000 shares of stock in Band Inc.; these shares represent 40% of Band Inc.'s total outstanding stock. Band Inc. earned $800,000 in net income for Year 1. Band Inc. declared and paid $500,000 in dividends for Year 1. Parade sold all 400,000 shares of the Band Inc. stock for $20 per share

The following investment activities relate to Parade Corp. Parade has a December 31 year end. Year 1: January 2 December 31 December 31 Year 2: March 5 Parade Corp. paid $5,000,000 cash to acquire 400,000 shares of stock in Band Inc.; these shares represent 40% of Band Inc.'s total outstanding stock. Band Inc. earned $800,000 in net income for Year 1. Band Inc. declared and paid $500,000 in dividends for Year 1. Parade sold all 400,000 shares of the Band Inc. stock for $20 per share

SWFT Corp Partner Estates Trusts

42nd Edition

ISBN:9780357161548

Author:Raabe

Publisher:Raabe

Chapter14: Taxes On The Financial Statements

Section: Chapter Questions

Problem 28P

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