9 Following are the individual financial statements for Gibson and Davis for the year ending December 31, 2024:SalesCost of goods soldOperating expensesDividend incomeNet incomeRetained earnings, 1/1/24Net incomeDividends declaredRetained earnings, 12/31/24Cash and receivablesInventoryInvestment in DavisBuildings (net)Equipment (net)Total assetsLiabilitiesCommon stockRetained earnings, 12/31/24Total liabilities and stockholders' equityAccountGoodwillEquipment (net)Common stockBuildings (net)Dividends declaredGibson acquired 60 percent of Davis on April 1, 2024, for $511,500. On that date, equipment owned by Davis (with a five-yearremaining life) was overvalued by $75,000. Also on that date, the fair value of the 40 percent noncontrolling interest was $341,000.Davis earned income evenly during the year but declared the $40,000 dividend on November 1, 2024.Required:a. Prepare a consolidated income statement for the year ending December 31, 2024.b. Determine the consolidated balance for each of the following accounts as of December 31, 2024:Required A Required BComplete this question by entering your answers in the tabs below.SalesCost of goods soldOperating expensesConsolidated net incomeGibson$ (718,000)332,000214,000(24,000)$ (196,000)$ (705,000)(196,000)60,000$ (841,000)$ 228,500504,000511,500538,000494,000$ 2,276,000$ (805,000)(630,000)(841,000)$ (2,276,000)X Answer is complete but not entirely correct.Prepare a consolidated income statement for the year ending December 31, 2024.Note: Enter all amounts as positive values.Consolidated Income StatementFor the Year Ending December 31, 2024Noncontrolling interest in consolidated net incomeControlling interest in consolidated net income$< Required A444,500259,000$$984,250703,500280,750$ (130,000)$ (410,000)(130,000)40,000$ (500,000)$ 133,000137,0000610,000494,000$ 1,374,000$ (534,000)(340,000)(500,000)$ (1,374,000)Davis$ (355,000)150,00075,000052,000 X228,750Required B

Solution:Introduction:Acquisition of a business means obtaining ownership in shares from…

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 Retained earnings, 12/31/24 O Cash and receivables Inventory Investment in Davis Buildings (net) Equipment (net) Total assets Account Liabilities Common stock Retained earnings, 12/31/24 Total liabilities and stockholders' equity Gibson $ (718,000) 332,000 214,000 (24,000) $ (196,000) $ (705,000) (196,000) 60,000 $ (841,000) $ 228,500 504,000 511,500 538,000 494,000 $ 2,276,000 $ (805,000) (630,000) (841,000) $ (2,276,000) Davis $ (355,000) 150,000 75,000 0 $ (130,000) $ (410,000) (130,000) 40,000 $ (500,000) $ 133,000 137,000 0 610,000 494,000 $ 1,374,000 $ (534,000) (340,000) (500,000) $ (1,374,000) Gibson acquired 60 percent of Davis on April 1, 2024, for $511,500. On that date, equipment owned by Davis (with a five-year

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 Retained earnings, 12/31/24 O Cash and receivables Inventory Investment in Davis Buildings (net) Equipment (net) Total assets Account Liabilities Common stock Retained earnings, 12/31/24 Total liabilities and stockholders' equity Gibson $ (718,000) 332,000 214,000 (24,000) $ (196,000) $ (705,000) (196,000) 60,000 $ (841,000) $ 228,500 504,000 511,500 538,000 494,000 $ 2,276,000 $ (805,000) (630,000) (841,000) $ (2,276,000) Davis $ (355,000) 150,000 75,000 0 $ (130,000) $ (410,000) (130,000) 40,000 $ (500,000) $ 133,000 137,000 0 610,000 494,000 $ 1,374,000 $ (534,000) (340,000) (500,000) $ (1,374,000) Gibson acquired 60 percent of Davis on April 1, 2024, for $511,500. On that date, equipment owned by Davis (with a five-year

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter5: The Income Statement And The Statement Of Cash Flows

Section: Chapter Questions

Problem 8E: Cost of Goods Sold, Income Statement. and Statement of Comprehensive Income Gaskin Company derives...

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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 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 Goodwill Equipment (net) Common stock Buildings (net) Dividends declared Account Required A Required B Goodwill Equipment (net) Common stock Gibson $ (742,000) 327,808 247,808 (12,800) $ (180,000) $ (798,088) (180,000) 78,000 $ (988,000) Complete this question by entering your answers in the tabs below. Buildings (net) Dividends declared $ 211,958 545,000 622,050 617,208 402,000 $ 2,398,000 $ (860,000) (630,000) (988,000) $ (2,398,000) $ 85,000 276,080 Determine the consolidated balance for each of the following accounts as of December…
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The income statement, balance sheets, and additional information for Great Adventures, Inc, are provided below. GREAT ADVENTURES, INC. Income Statement For the year ended December 31, 2022 Net revenues: Expenses: Cost of goods sold Operating expenses Depreciation expense Interest expense Income tax expense Total expenses $198,830 $40,100 70,920 19,650 10,775 16,100 157,545 $ 40,485 Net income GREAT ADVENTURES, INC. Balance Sheets December 31, 2022 and 2021 Increase (I) or Decrease (D) 2022 2021 Assets Current assets: Cash Accounts receivable Inventory Other current assets Long-term assets: Land Buildings Equipment Accumu lated depreciation Total assets $ 302,742 50, 480 10, 200 1,220 $ 248,802 (I) 50,480 (I) 10,200 (I) 4,560 (D) $ 53,940 5,780 820,000 896,000 94,960 (28,450) $2,147,152 $117,800 820,eee (I) 896, e00 (I) 38,960 (I) 19,650 (I) 56,000 (8,800) Liabilities and Stockholders Equity Current liabilities: Accounts payable Interest payable Income tax payable Other current…