E5-5 Balance Sheet WorksheetProblem Company owns 90 percent of Solution Dairy's stock. The balance sheets of the twocompanies immediately after the Solution acquisition showed the following amounts:Cash & ReceivablesInventoryLandBuildings & Equipment (net)Investment in Solution DairyProblemCompany$ 130,000210,00070,000390,000SolutionDairy$ 70,00090,00040,000220,000270,000Total Assets$1,070,000$420,000Current PayablesLong-Term LiabilitiesCommon Stock$80,000$ 40,000200,000100,000400,00060,000Retained Earnings390,000220,000Total Liabilities & Stockholders' Equity$1,070,000$420,000The fair value of the noncontrolling interest at the date of acquisition was determined to be $30,000.The full amount of the increase over book value is assigned to land held by Solution. At the dateof acquisition, Solution owed Problem $8,000 plus $900 accrued interest. Solution had recordedthe accrued interest, but Problem had not.RequiredPrepare and complete a consolidated balance sheet worksheet.

To complete the consolidated balance sheet, the accounts of both Problem Company and Solution Dairy…

Answered: E5-5 Balance Sheet Worksheet Problem…

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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Problem Company owns 90 percent of Solution Dairy's stock. The balance sheets of the two companies immediately after the Solution acquisition showed the following amounts: Assets Cash & Receivables. Inventory Land Buildings & Equipment (net) Investment in Solution Dairy Total Assets Liabilities & Stockholders' Equity Current Payables Long-Term Liabilities Common Stock Retained Earnings Total Liabilities & Stockholders' Equity Problem Company $ 132,000 211,000 74,000 409,000 259,200 $ 1,085,200 Solution Dairy $ 88,000 108,000 54,000 228,000 $ 478,000 $ 77,000 254,200 382,000 372,000 $ 30,000 180,000 66,000 202,000 $ 1,085,200 $ 478,000 The fair value of the noncontrolling interest at the date of acquisition was determined to be $28,800. The full amount of the increase over book value is assigned to land held by Solution. At the date of acquisition, Solution owed Problem $9,000 plus $1,100 accrued interest. Solution had recorded the accrued interest, but Problem had not Required: Prepare…
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