3-4 practice (2) - Exercise 3-4 Common Information...

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Exercise 3-4 Common Information Ownership Interest Price Paid Cash Total $- Acquired Company's Balance Sheet Before Purchase Book Value Life Life Assets Liabilities Equity Goodwill Total Assets $- $- $- $- Parent Price NCI Fair Value of Subsidiary Common Stock Paid in Excess Retained Earnings Total Equity Interest Acquired Book Value Accounts Adjusted Total $- Amortization Schedule Account Adjusted Life Total Key Total Amortizations Subsidiary Debit Credit $15,000 Amortizations $6,250 Total (adjusted) $8,750 NCI Share $1,750 Controlling Share $47,000 Parent $40,000 Controlling Share of Subsidiary $7,000 Total $47,000 Exercise 3-4 Consolidated Worksheet Trial Balance Eliminations Consol NCI Control. Consol. Pepper Sultan Dr Cr Net Inc. R.E. Bal. Sht. Current Assets $152,000 $115,000 Investment in Subsidiary $270,000 $12,000 $8,000 $216,000 $50,000 Depreciable Fixed Assets $400,000 $200,000 $62,500 Accumulated Depreciation $(130,000) $(40,000) $12,500 Goodwill Current liabilities $(80,000) Common Stock--Sultan $(100,000) $80,000 (20,000) Retained Earnings-Sultan $(170,000) $137,250 $12,500 (45,250) Common stock - Pepper $(300,000) $5,000 Retained earnings-Pepper $(260,000) $(260,000) Sales $(200,000) $(100,000) $(300,000) Expenses $160,000 $85,000 $245,000 Depreciation Expense $6,250 $6,250 Gain on acquisition Subsidiary (dividend) income $(12,000) $12,000 Dividends declared -Sultan $10,000 $8,000 2,000 Totals $- $- Consolidated net income $(48,750) NCI share $(1,750) (1,750) Controlling share $(47,000) (47,000) NCI (65,000) Controlling retained earnings (307,000) Totals Eliminations CY1 Subsidiary Income $12,000 Investment in Sultan $12,000 Investment in Sultan $8,000 CY2 Dividends Declared $8,000 CS $80,000 EL RE $136,000 Investment in Sultan $216,000 Fixed Assets $62,500 D Investment in Sultan $50,000 NCI (RE) $12,500 Depreciation exp $6,250 A Retained Earnings - Pepper $5,000 Retaine Earnings - Sultan $1,250
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