g Perfection purchased a 25% stake in Satisfactory for $486,000 on Jan 2, 2021. On Jan 1, 2021, Satisfactory had a book value of equity on its balance sheet of $1,944,000. What is the value that Perfection records in it's books on Jan 2, 2021 related to its investment in Satisfactory

The value that Perfection records in it's books on Jan 2, 2021 related to its investment in Satisfactory is:

$486,000.

Explanation:

a) Data and Calculations:

Net asset value of Satisfactory = $1,944,000 on acquisition date

Stake purchased by Perfection = 25%

25% of the net asset value of Satisfactory = $486,000 ($1,944,000 * 25%)

b) There is no goodwill arising from the investment in Satisfactory.  The equity method will be used to account for the investment in the Satisfactory.  The Equity Method involves recording the investment in an associated company like Satisfactory when Perfection's ownership interest in Satisfactory is valued at 20–50% of the net assets.

1   all nations face the problem of scarcity because there are limited resources and unlimited wants. nations do not have enough factors of production to produce everything that their population wants. entrepreneurial resources initiate businesses to make new goods and services; labor resources produce goods and services.

2 there are four factors of production: natural resources, labor resources, capital resources, and entrepreneurial resources. natural resources are raw materials from nature that are used to produce goods. trees, water, and grains are natural resources. some natural resources, such as wheat and cattle, are renewable

3 wants

things that you do not need to have in order to survive, but would like to have

needs

things that you must have in order to survive

goods

physical products

services

tasks that a business perform for customers

resources

items that people can use to make or obtain what they need or want

determine

to settle or decide by choice of alternatives or possiblities

4 i really dont know