Kirby Moore Sales ..... Cost of goods sold. Operating and interest expenses Net income.... Retained earnings, 1/1/18. Net income..... Dividends declared.. Retained earnings, 12/31/18. $ (800,000) $ (600,000) 400,000 160,000 $ (40,000) 500,000 $ (200,000) $ (990,000) $ (550,000) 130,000 -0- $ (590,000) $(1,060,000) Moore Kirby $ 217,000 224,000 657,000 600,000 1,000,000 (100,000) 200,000 $ 2,798,000 Cash and receivables.. $ 180,000 Inventory.. Investment in Kirby. Equipment (net). Buildings.... Accumulated depreciation-buildings Other assets. 160,000 -0- 420,000 650,000 (200,000) 100,000 $ 1,310,000 $ (570,000) (150,000) (590,000) $(1,310,000) Total assets Liabilities.... $(1,138,000) (600,000) |(1,060,000) $(2,798,000) Common stock Retained earnings, 12/31/18. Total liabilities and equity .
Following are financial statements for Moore Company and Kirby Company for 2018:
• Moore purchased 90 percent of Kirby on January 1, 2017, for $657,000 in cash. On that date, the 10 percent noncontrolling interest was assessed to have a $73,000 fair value. Also at the acquisition date, Kirby held equipment (four-year remaining life) undervalued in its financial records by $20,000 and interest-bearing liabilities (five-year remaining life) overvalued by $40,000. The rest of the excess fair over book value was assigned to previously unrecognized brand names and amortized over a 10-year life.
• During 2017 Kirby reported a net income of $80,000 and declared no dividends.
• Each year Kirby sells Moore inventory at a 20 percent gross profit rate. Intra-entity sales were $145,000 in 2017 and $160,000 in 2018. On January 1, 2018, 30 percent of the 2017 transfers were still on hand, and on December 31, 2018, 40 percent of the 2018 transfers remained.
• Moore sold Kirby a building on January 2, 2017. It had cost Moore $100,000 but had $90,000 in
Determine all consolidated balances either computationally or by using a worksheet.
![Kirby
Moore
Sales .....
Cost of goods sold.
Operating and interest expenses
Net income....
Retained earnings, 1/1/18.
Net income.....
Dividends declared..
Retained earnings, 12/31/18.
$ (800,000)
$ (600,000)
400,000
160,000
$ (40,000)
500,000
$ (200,000)
$ (990,000)
$ (550,000)
130,000
-0-
$ (590,000)
$(1,060,000)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fb6b24b6d-e223-475e-b89e-9b193f923dd1%2F3d904d63-b422-4500-aaff-a73ad1a3814c%2Fmwp6r8i.png&w=3840&q=75)
![Moore
Kirby
$ 217,000
224,000
657,000
600,000
1,000,000
(100,000)
200,000
$ 2,798,000
Cash and receivables..
$ 180,000
Inventory..
Investment in Kirby.
Equipment (net).
Buildings....
Accumulated depreciation-buildings
Other assets.
160,000
-0-
420,000
650,000
(200,000)
100,000
$ 1,310,000
$ (570,000)
(150,000)
(590,000)
$(1,310,000)
Total assets
Liabilities....
$(1,138,000)
(600,000)
|(1,060,000)
$(2,798,000)
Common stock
Retained earnings, 12/31/18.
Total liabilities and equity .](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fb6b24b6d-e223-475e-b89e-9b193f923dd1%2F3d904d63-b422-4500-aaff-a73ad1a3814c%2Fj7lnw99.png&w=3840&q=75)
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