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7. NCI in net assets (i.e., NCI's fair value) at the acquisition date: 8. Goodwill at the acquisition date: 9. Consolidated net income, 2020:

7. NCI in net assets (i.e., NCI's fair value) at the acquisition date: 8. Goodwill at the acquisition date: 9. Consolidated net income, 2020:

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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(Use the data below for Questions 7-17.) Company Pacquires 80% of Company S for $600,000 on 1/1/19. P did not pay a "control premium" for the acquisition. On that date, S reported common stock of $200,000 and retained earnings of $250,000. In addition, the fair value of S's buildings (14-year remaining life) was higher than their carrying value by $70,000. All other assets and liabilities have fair value equal to carrying value. P uses the partial equity method to record its investment in S. Below are some data taken from accounting records of the year 2020 (the second year). P's own operating income, 2020: $540,000 S's net income, 2020 $180,000 S's retained earnings at 1/1/20: $340,000 S's dividends declared, 2020: $120,000 Provide the following figures: 7. NCI in net assets (i.e., NCI's fair value) at the acquisition date: 8. Goodwill at the acquisition date: 9. Consolidated net income, 2020: 10. NCI in net income, 2020: 11. P's net income, 2020: 12. P's "Investment in S", 12/31/20: 13. NCI in net assets, 12/31/20: Now assume P has been using the equity method instead, re-compute the following items: 14. P's net income, 2020: 15. P's "Investment in S", 12/31/20: 16. NCI in net income, 2020: 17. Consolidated net income, 2020:
Transcribed Image Text:(Use the data below for Questions 7-17.) Company Pacquires 80% of Company S for $600,000 on 1/1/19. P did not pay a "control premium" for the acquisition. On that date, S reported common stock of $200,000 and retained earnings of $250,000. In addition, the fair value of S's buildings (14-year remaining life) was higher than their carrying value by $70,000. All other assets and liabilities have fair value equal to carrying value. P uses the partial equity method to record its investment in S. Below are some data taken from accounting records of the year 2020 (the second year). P's own operating income, 2020: $540,000 S's net income, 2020 $180,000 S's retained earnings at 1/1/20: $340,000 S's dividends declared, 2020: $120,000 Provide the following figures: 7. NCI in net assets (i.e., NCI's fair value) at the acquisition date: 8. Goodwill at the acquisition date: 9. Consolidated net income, 2020: 10. NCI in net income, 2020: 11. P's net income, 2020: 12. P's "Investment in S", 12/31/20: 13. NCI in net assets, 12/31/20: Now assume P has been using the equity method instead, re-compute the following items: 14. P's net income, 2020: 15. P's "Investment in S", 12/31/20: 16. NCI in net income, 2020: 17. Consolidated net income, 2020:
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