Math  /  Numbers & Operations

Question8.. Two years ago, Print Co, acquired 30%30 \% of Stamp Co, common stock for $750,000\$ 750,000. Today, Print acquired the remaining 70%70 \% shares of Stamp for $2,100,000\$ 2,100,000 cash. Print's total investment would a mount to A. $3,200,000\$ 3,200,000, B. $2,500,000\$ 2,500,000, C. $3,000,000\$ 3,000,000, D. $2,850,000\$ 2,850,000.

Studdy Solution

STEP 1

1. Print Co. initially acquired 30% 30\% of Stamp Co.'s common stock for $750,000\$750,000.
2. Print Co. later acquired the remaining 70% 70\% of Stamp Co.'s shares for $2,100,000\$2,100,000.
3. We need to calculate the total investment made by Print Co. in acquiring 100% 100\% of Stamp Co.'s shares.

STEP 2

1. Calculate the initial investment for 30% 30\% .
2. Calculate the investment for the remaining 70% 70\% .
3. Sum the investments to find the total investment.

STEP 3

The initial investment for 30% 30\% of Stamp Co.'s shares was $750,000\$750,000.

STEP 4

The investment for the remaining 70% 70\% of Stamp Co.'s shares was $2,100,000\$2,100,000.

STEP 5

Add the investments for 30% 30\% and 70% 70\% to find the total investment:
$750,000+$2,100,000=$2,850,000\$750,000 + \$2,100,000 = \$2,850,000
The total investment made by Print Co. to acquire 100% 100\% of Stamp Co.'s shares is:
$2,850,000\boxed{\$2,850,000}

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