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At what amount will the following accounts appear in the consolidated financial statements? Note: Do not use negative signs with any answers. Account Amount a. Sales $ b. Investment Income $ c. Operating expenses $ d. Inventories $ $ $ $ $ i. Retained Earnings $ e. Equity investment f. PPE, net g. Goodwill h. Common Stock

At what amount will the following accounts appear in the consolidated financial statements? Note: Do not use negative signs with any answers. Account Amount a. Sales $ b. Investment Income $ c. Operating expenses $ d. Inventories $ $ $ $ $ i. Retained Earnings $ e. Equity investment f. PPE, net g. Goodwill h. Common Stock

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Determining ending consolidated balances in the third year following the acquisition-Cost method Assume a parent company acquired a subsidiary on January 1, 2020, for $1,300,000. The purchase price was $845,000 in excess of the subsidiary's $455,000 book value of Stockholders' Equity on the acquisition date. Of this excess purchase price, $520,000 was assigned to Property, plant and equipment with a remaining economic useful life of 8 years, and $325,000 was assigned to Goodwill. On the acquisition date, the subsidiary reported retained earnings equal to $104,000. The parent uses Investment cost method of pre-consolidation Equity investment bookkeeping. The financial statements of the parent and its subsidiary for the year ended December 31, 2022, are as follows: Parent Subsidiary Income statement: Sales Cost of goods sold Gross profit Investment income Operating expenses Net income Statement of retained earnings: BOY retained earnings Net income Dividends Ending retained earnings Balance sheet: $3,120,000 $1,170,000 Assets (1,690,000) (715,000) Cash 1,430,000 455,000 Accounts receivable 65,000 Inventory (780,000) (325,000) Equity investment $715,000 $130,000 Property, plant and equipment (PPE), net $1,950,000 $ 650,000 Liabilities and stockholders' equity 130,000 Accounts payable 715,000 (325,000) (65,000) Accrued liabilities $2,340,000 $715,000 Long-term liabilities Common stock APIC Retained earnings Parent Subsidiary $1,430,000 $195,000 1,950,000 312,000 3,120,000 650,000 1,300,000 5,200,000 1,300,000 $13,000,000 $2,457,000 $1,300,000 $221,000 1,040,000 260,000 3,900,000 910,000 650,000 156,000 3,770,000 195,000 2,340,000 715,000 $13,000,000 $2,457,000
Transcribed Image Text:Determining ending consolidated balances in the third year following the acquisition-Cost method Assume a parent company acquired a subsidiary on January 1, 2020, for $1,300,000. The purchase price was $845,000 in excess of the subsidiary's $455,000 book value of Stockholders' Equity on the acquisition date. Of this excess purchase price, $520,000 was assigned to Property, plant and equipment with a remaining economic useful life of 8 years, and $325,000 was assigned to Goodwill. On the acquisition date, the subsidiary reported retained earnings equal to $104,000. The parent uses Investment cost method of pre-consolidation Equity investment bookkeeping. The financial statements of the parent and its subsidiary for the year ended December 31, 2022, are as follows: Parent Subsidiary Income statement: Sales Cost of goods sold Gross profit Investment income Operating expenses Net income Statement of retained earnings: BOY retained earnings Net income Dividends Ending retained earnings Balance sheet: $3,120,000 $1,170,000 Assets (1,690,000) (715,000) Cash 1,430,000 455,000 Accounts receivable 65,000 Inventory (780,000) (325,000) Equity investment $715,000 $130,000 Property, plant and equipment (PPE), net $1,950,000 $ 650,000 Liabilities and stockholders' equity 130,000 Accounts payable 715,000 (325,000) (65,000) Accrued liabilities $2,340,000 $715,000 Long-term liabilities Common stock APIC Retained earnings Parent Subsidiary $1,430,000 $195,000 1,950,000 312,000 3,120,000 650,000 1,300,000 5,200,000 1,300,000 $13,000,000 $2,457,000 $1,300,000 $221,000 1,040,000 260,000 3,900,000 910,000 650,000 156,000 3,770,000 195,000 2,340,000 715,000 $13,000,000 $2,457,000
At what amount will the following accounts appear in the consolidated financial statements? Note: Do not use negative signs with any answers. Account a. Sales $ b. Investment Income $ c. Operating expenses $ d. Inventories $ $ $ $ $ $ e. Equity investment f. PPE, net g. Goodwill h. Common Stock i. Retained Earnings Check Amount
Transcribed Image Text:At what amount will the following accounts appear in the consolidated financial statements? Note: Do not use negative signs with any answers. Account a. Sales $ b. Investment Income $ c. Operating expenses $ d. Inventories $ $ $ $ $ $ e. Equity investment f. PPE, net g. Goodwill h. Common Stock i. Retained Earnings Check Amount
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