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Following are the Individual financial statements for Gibson and Davis for the year ending December 31, 2024: Sales Cost of goods sold Operating expenses Dividend income Net income Retained earnings, 1/1/24 Net income Dividends declared Account Retained earnings, 12/31/24 Cash and receivables Inventory Investment in Davis Buildings (net) Equipment (net) Total assets Liabilities Common stock Retained earnings, 12/31/24 Total liabilities and stockholders' equity Gibson $ (749,000) 363,000 240,000 (24,000) $ (170,000) $ (751,000) (170,000) 60,000 $ (861,000) $ 287,300 562,000 569,700 526,000 403,000 $ 2,348,000 $ (857,000) (630,000) (861,000) $ (2,348,000) Davis $ (421,000) 181,000 82,000 $ (158,000) $ (404,000) (158,000) 40,000 $ (522,000) $ 92,000 183,000 Ө 688,000 454,000 $ 1,417,000 $ (555,000) (340,000) (522,000) $ (1,417,000) Gibson acquired 60 percent of Davis on April 1, 2024, for $569,700. On that date, equipment owned by Davis (with a five-year remaining life) was overvalued by $63,000. Also on that date, the fair value of the 40 percent noncontrolling Interest was $379,800. Davis earned Income evenly during the year but declared the $40,000 dividend on November 1, 2024. Required: a. Prepare a consolidated Income statement for the year ending December 31, 2024. b. Determine the consolidated balance for each of the following accounts as of December 31, 2024:

Following are the Individual financial statements for Gibson and Davis for the year ending December 31, 2024: Sales Cost of goods sold Operating expenses Dividend income Net income Retained earnings, 1/1/24 Net income Dividends declared Account Retained earnings, 12/31/24 Cash and receivables Inventory Investment in Davis Buildings (net) Equipment (net) Total assets Liabilities Common stock Retained earnings, 12/31/24 Total liabilities and stockholders' equity Gibson $ (749,000) 363,000 240,000 (24,000) $ (170,000) $ (751,000) (170,000) 60,000 $ (861,000) $ 287,300 562,000 569,700 526,000 403,000 $ 2,348,000 $ (857,000) (630,000) (861,000) $ (2,348,000) Davis $ (421,000) 181,000 82,000 $ (158,000) $ (404,000) (158,000) 40,000 $ (522,000) $ 92,000 183,000 Ө 688,000 454,000 $ 1,417,000 $ (555,000) (340,000) (522,000) $ (1,417,000) Gibson acquired 60 percent of Davis on April 1, 2024, for $569,700. On that date, equipment owned by Davis (with a five-year remaining life) was overvalued by $63,000. Also on that date, the fair value of the 40 percent noncontrolling Interest was $379,800. Davis earned Income evenly during the year but declared the $40,000 dividend on November 1, 2024. Required: a. Prepare a consolidated Income statement for the year ending December 31, 2024. b. Determine the consolidated balance for each of the following accounts as of December 31, 2024:

Principles of Accounting Volume 1
Principles of Accounting Volume 1
19th Edition
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax
Chapter6: Merchandising Transactions
Section: Chapter Questions
Problem 15EA: The following select account data is taken from the records of Reese Industries for 2019. A. Use the...
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Following are the Individual financial statements for Gibson and Davis for the year ending December 31, 2024: Sales Cost of goods sold Operating expenses Dividend income Net income Retained earnings, 1/1/24 Net income Dividends declared Account Retained earnings, 12/31/24 Cash and receivables Inventory Investment in Davis Buildings (net) Equipment (net) Total assets Liabilities Common stock Retained earnings, 12/31/24 Total liabilities and stockholders' equity Gibson $ (749,000) 363,000 240,000 (24,000) $ (170,000) $ (751,000) (170,000) 60,000 $ (861,000) $ 287,300 562,000 569,700 526,000 403,000 $ 2,348,000 $ (857,000) (630,000) (861,000) $ (2,348,000) Davis $ (421,000) 181,000 82,000 $ (158,000) $ (404,000) (158,000) 40,000 $ (522,000) $ 92,000 183,000 Ө 688,000 454,000 $ 1,417,000 $ (555,000) (340,000) (522,000) $ (1,417,000) Gibson acquired 60 percent of Davis on April 1, 2024, for $569,700. On that date, equipment owned by Davis (with a five-year remaining life) was overvalued by $63,000. Also on that date, the fair value of the 40 percent noncontrolling Interest was $379,800. Davis earned Income evenly during the year but declared the $40,000 dividend on November 1, 2024. Required: a. Prepare a consolidated Income statement for the year ending December 31, 2024. b. Determine the consolidated balance for each of the following accounts as of December 31, 2024:
Transcribed Image Text:Following are the Individual financial statements for Gibson and Davis for the year ending December 31, 2024: Sales Cost of goods sold Operating expenses Dividend income Net income Retained earnings, 1/1/24 Net income Dividends declared Account Retained earnings, 12/31/24 Cash and receivables Inventory Investment in Davis Buildings (net) Equipment (net) Total assets Liabilities Common stock Retained earnings, 12/31/24 Total liabilities and stockholders' equity Gibson $ (749,000) 363,000 240,000 (24,000) $ (170,000) $ (751,000) (170,000) 60,000 $ (861,000) $ 287,300 562,000 569,700 526,000 403,000 $ 2,348,000 $ (857,000) (630,000) (861,000) $ (2,348,000) Davis $ (421,000) 181,000 82,000 $ (158,000) $ (404,000) (158,000) 40,000 $ (522,000) $ 92,000 183,000 Ө 688,000 454,000 $ 1,417,000 $ (555,000) (340,000) (522,000) $ (1,417,000) Gibson acquired 60 percent of Davis on April 1, 2024, for $569,700. On that date, equipment owned by Davis (with a five-year remaining life) was overvalued by $63,000. Also on that date, the fair value of the 40 percent noncontrolling Interest was $379,800. Davis earned Income evenly during the year but declared the $40,000 dividend on November 1, 2024. Required: a. Prepare a consolidated Income statement for the year ending December 31, 2024. b. Determine the consolidated balance for each of the following accounts as of December 31, 2024:
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