Following are the individual financial statements for Gibson and Davis for the year ending December 31, 2021: Gibson Davis $ (739,000) $ (442,500) 189,000 69,500 Sales Cost of goods sold Operating expenses Dividend income Net income Retained earnings, 1/1/21 Net income Dividends declared. Retained earnings, 12/31/21 Cash and receivables Inventory Investment in Davis Buildings (net) Equipment (net) Total assets Liabilities Common stock Retained earnings, 12/31/21 Total liabilities and stockholders' equity Goodwill Equipment (net) Common stock Buildings (net) Dividends declared Required A Required B 320,000 253,000 (18,000) (184,000) $ (184,000) $ $ (737,000) $ (184,000) 70,000 $ (851,000) $ $ $ Gibson acquired 60 percent of Davis on April 1, 2021, for $548,400. On that date, equipment owned by Davis (with a five-year remaining life) was overvalued by $45,000. Also on that date, the fair value of the 40 percent noncontrolling interest was $365,600. Davis earned income evenly during the year but declared the $40,000 dividend on November 1, 2021. 256,600 526,000 548,400 a. Prepare a consolidated income statement for the year ending December 31, 2021. b. Determine the consolidated balance for each of the following accounts as of December 31, 2021: Revenues Cost of goods sold Operating expenses Consolidated net income Noncontrolling interest in CNI Controlling interest in CNI 554,000 405,000 2,290,000 627,000 453,000 $ $ 1,443,000 $ (809,000) $ (548,000) (340,000) (555,000) $(1,443,000) (630,000) (851,000) $(2,290,000) Complete this question by entering your answers in the tabs below. (401,000) (184,000) 30,000 (555,000) ✓ ✓ ✓ ✓ 146,000 217,000 Consolidated Income Statement For the Year Ending December 31, 2021 Prepare a consolidated income statement for the year ending December 31, 2021. (Enter all amounts as positive values.) Answer is not complete. $461,750✔ 311,875 X $ 1,070,875 773,625 297,250 $ 297,250

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Following are the individual financial statements for Gibson and Davis for the year ending December 31, 2021:
Sales.
Cost of goods sold
Operating expenses
Dividend income
Net income
Retained earnings, 1/1/21
Net income
Dividends declared
Retained earnings, 12/31/21
Cash and receivables.
Inventory
Investment in Davis
Buildings (net)
Equipment (net)
Total assets
Liabilities
Common stock
Retained earnings, 12/31/21
Total liabilities and
stockholders' equity
Goodwill
Equipment (net)
Common stock
Buildings (net)
Dividends declared
Gibson
Davis
$ (739,000) $ (442,500)
320,000
189,000
253,000
69,500
(18,000)
0
(184,000) $ (184,000)
(737,000) $
(184,000)
70,000
(851,000) $
$
$
Required A Required B
$
$
256,600 $
526,000
548,400
554,000
405,000
$2,290,000
Gibson acquired 60 percent of Davis on April 1, 2021, for $548,400. On that date, equipment owned by Davis (with a five-year
remaining life) was overvalued by $45,000. Also on that date, the fair value of the 40 percent noncontrolling interest was $365,600.
Davis earned income evenly during the year but declared the $40,000 dividend on November 1, 2021.
Revenues
Cost of goods sold
Operating expenses
Consolidated net income
Noncontrolling interest in CNI
Controlling interest in CNI
$ (809,000) $
(630,000)
(851,000)
$(2,290,000)
a. Prepare a consolidated income statement for the year ending December 31, 2021.
b. Determine the consolidated balance for each of the following accounts as of December 31, 2021:
Complete this question by entering your answers in the tabs below.
Consolidated Income Statement
For the Year Ending December 31, 2021
>>>>>>
Prepare a consolidated income statement for the year ending December 31, 2021. (Enter all amounts as positive values.)
✓
(401,000)
(184,000)
30,000
(555,000)
146,000
217,000
0
627,000
453,000
$ 1,443,000
✓$ $461,750
✓
(548,000)
(340,000)
(555,000)
$ (1,443,000)
Answer is not complete.
✓
311,875 X
$ 1,070,875
773,625
297,250
$ 297,250
Transcribed Image Text:Following are the individual financial statements for Gibson and Davis for the year ending December 31, 2021: Sales. Cost of goods sold Operating expenses Dividend income Net income Retained earnings, 1/1/21 Net income Dividends declared Retained earnings, 12/31/21 Cash and receivables. Inventory Investment in Davis Buildings (net) Equipment (net) Total assets Liabilities Common stock Retained earnings, 12/31/21 Total liabilities and stockholders' equity Goodwill Equipment (net) Common stock Buildings (net) Dividends declared Gibson Davis $ (739,000) $ (442,500) 320,000 189,000 253,000 69,500 (18,000) 0 (184,000) $ (184,000) (737,000) $ (184,000) 70,000 (851,000) $ $ $ Required A Required B $ $ 256,600 $ 526,000 548,400 554,000 405,000 $2,290,000 Gibson acquired 60 percent of Davis on April 1, 2021, for $548,400. On that date, equipment owned by Davis (with a five-year remaining life) was overvalued by $45,000. Also on that date, the fair value of the 40 percent noncontrolling interest was $365,600. Davis earned income evenly during the year but declared the $40,000 dividend on November 1, 2021. Revenues Cost of goods sold Operating expenses Consolidated net income Noncontrolling interest in CNI Controlling interest in CNI $ (809,000) $ (630,000) (851,000) $(2,290,000) a. Prepare a consolidated income statement for the year ending December 31, 2021. b. Determine the consolidated balance for each of the following accounts as of December 31, 2021: Complete this question by entering your answers in the tabs below. Consolidated Income Statement For the Year Ending December 31, 2021 >>>>>> Prepare a consolidated income statement for the year ending December 31, 2021. (Enter all amounts as positive values.) ✓ (401,000) (184,000) 30,000 (555,000) 146,000 217,000 0 627,000 453,000 $ 1,443,000 ✓$ $461,750 ✓ (548,000) (340,000) (555,000) $ (1,443,000) Answer is not complete. ✓ 311,875 X $ 1,070,875 773,625 297,250 $ 297,250
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