5-On January 2, 2018, Moving Motors, Inc. acquired Bourland Enterprises as a wholly-owned subsidiary, paying an excess of $800,000 over the book value of Bourland's net assets.  Part of the excess was attributable to a building with a 7-year life undervalued by $350,000.  The rest was goodwill.  The parent uses the equity method of pre-consolidation Equity investment bookkeeping. The 2020 financial statements for the two companies are presented below.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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5-On January 2, 2018, Moving Motors, Inc. acquired Bourland Enterprises as a wholly-owned subsidiary, paying an excess of $800,000 over the book value of Bourland's net assets.  Part of the excess was attributable to a building with a 7-year life undervalued by $350,000.  The rest was goodwill.  The parent uses the equity method of pre-consolidation Equity investment bookkeeping. The 2020 financial statements for the two companies are presented below.

 

Moving Motors, Inc.

Bourland Enterprises

Sales revenue

$1,875,000

$781,000

Cost of goods sold

-658,000

-451,000

Gross profit

1,217,000

330,000

Operating expenses

-325,000

-129,000

Equity income

151,000

0

Net Income

$1,043,000

$201,000

 

 

 

Retained Earnings, 1/1/20

$2,307,000

$475,500

Net income

1,043,000

201,000

Dividends

-75,000

-23,400

Retained Earnings, 12/31/20

$3,275,000

$653,100

 

 

 

Cash and receivables

$491,240

$540,200

Inventory

785,000

515,200

Equity investment

1,459,600

 

Property, plant & equipment (Net)   

3,852,000

346,500

Total Assets

$6,587,840

$1,401,900

 

 

 

Accounts payable

$408,000

$157,800

Accrued liabilities

498,340

365,000

Notes payable

478,500

69,500

Common stock

350,000

70,000

Additional paid-in capital

1,578,000

86,500

Retained Earnings, 12/31/20

3,275,000

653,100

Total Liabilities and Equities

$6,587,840

$1,401,900

Required:  At what amount will the following accounts appear on the consolidated financial statements for 2020?

a. Cost of Goods Sold
b. Equity Income
c. Operating Expenses
d. Cash and Receivables
e. Equity Investment
f. Property, Plant and Equipment (net of accumulated depreciation)
g. Goodwill
h. Common Stock
i. Retained Earnings

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