Please help me to solve this problem Allen Company acquired 100 percent of Bradford Company's voting stock on January 1, 2017, by Issuing 10,000 shares of its $10 parvalue common stock (having a fair value of $17.50 per share). As of that date, Bradford had stockholders' equity totaling $112,150. Landshown on Bradford's accounting records was undervalued by $19,700. Equipment (with a five-year remaining life) was undervalued by$6.750. A secret formula developed by Bradford was appraised at $36,400 with an estimated life of 20 years.The following are the separate financial statements for the two companies for the year ending December 31, 2021. There were noIntra-entity payables on that date. Credit balances are indicated by parentheses.AllenCompanyBradfordCompany$ (303,750)Revenues$ (521,000)172,000Cost of goods soldDepreciation expenseSubsidiary earnings115,50054,000189,000(131,080)Net income$(291,080)$ (134,250)Retained earnings, 1/1/21Net income (above)$(762,000)(291,080)175,500$ (103,500)(134,250)40,000Dividends declaredRetained earnings ,12/31/21$ (877,580)$ (197,750)Current assets$$ 101,500374,000309,750Investment in Bradford@CompanyLand574,000854,08086,100186,000Buildings and equipment (net)Total assets$ 2,111,750$ 373,600Current liabilitiesCommon stock$ (110,850)Additional paid-in capital$ (544,170)(600,000)(90,000)(877,580)(60,000)(5,000)(197,750)Retained earnings, 12/31/21Total liabilities and equity$(2,111,750)$ (373,608)a-1. Complete the table to show the allocation of the fair value in excess of book value.a-2. Complete the table to show the computation for Subsidiary Earnings.b. Complete the worksheet by consolidating the financial Information for these two companies.Complete this question by entering your answers in the tabs below.Req A1Req A2Req BComplete the table to show the computation for Subsidiary Earnings. (Negative amounts should be indicated by a minussign.)AmountsEquity earningsS< Req A1Req B >

A subsidiary company is the company in which another company holds all or majority shares. The…

Allen Company acquired 100 percent of Bradford Company's voting stock on January 1, 2017, by Issuing 10,000 shares of its $10 par value common stock (having a fair value of $17.50 per share). As of that date, Bradford had stockholders' equity totalling $112.150. Land shown on Bradford's accounting records was undervalued by $19.700. Equipment (with a five-year remaining life) was undervalued by $6.750. A secret formula developed by Bradford was appraised at $36,400 with an estimated life of 20 years. The following are the separate financial statements for the two companies for the year ending December 31, 2021. There were no Intra-entity payables on that date. Credit balances are indicated by parentheses. Allen Company $ (521,000) Bradford Company $ (303,750) Revenues Cost of goods sold Depreciation expense Subsidiary earnings 172,000 189,000 (131,080) 115,500 54,000 Net income $ (291,080) $ Retained earnings, 1/1/21 Net Income (above) Dividends declared (762,000) (291,080) 175,500 $ (134,250) $ (103,500) (134,250) 40,000 Retained earnings ,12/31/21 $ (877,580) $ (197,750) Current assets $ $ 101,500 374,000 309,750 Investment in Bradford Company Land 574,000 854,000 86,100 186,000 Buildings and equipment (net) Total assets $ 2,111,750 $ 373,600 Current liabilities $ (110,850) Connon stock $ (544,170) (600,000) (90,000) (877,580) Additional paid-in capital (60,000) (5,000) (197,750) Retained earnings, 12/31/21 Total liabilities and equity $(2,111,750) $ (373,600) a-1. Complete the table to show the allocation of the fair value in excess of book value. a-2. Complete the table to show the computation for Subsidiary Earnings. b. Complete the worksheet by consolidating the financial Information for these two companies. Complete this question by entering your answers in the tabs below.

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q