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On December 31, Year 3, Mueller Corp. acquired 80% of the outstanding shares of Wilson Inc. for a total cost of $276,000. The carrying amount of Wilson's assets, liabilities, and equity was equal to fair value except for the following: Inventory Equipment, net Patent Long-term debt Common shares Retained earnings $ Dividend income Net income Common shares Retained earnings Carrying Amount Fair Value 61,700 $ 71,400 287,000 293,000 43,400 163,400 $ 197,000 192,000 45,400 As at December 31, Year 3, the equipment and patent had an estimated useful life of six and eight years, respectively. The long-term debt is due on January 1, Year 9. There was a goodwill impairment loss of $3,000 in Year 5. There were no other impairment losses. Mueller uses the cost method to account for its investment in Wilson. The book values of selected accounts for the year ended December 31, Year 7 were as follows: Mueller 13,700 65,400 108,500 284,000 ? ? Wilson $ 29,400 192,000 144,000

On December 31, Year 3, Mueller Corp. acquired 80% of the outstanding shares of Wilson Inc. for a total cost of $276,000. The carrying amount of Wilson's assets, liabilities, and equity was equal to fair value except for the following: Inventory Equipment, net Patent Long-term debt Common shares Retained earnings $ Dividend income Net income Common shares Retained earnings Carrying Amount Fair Value 61,700 $ 71,400 287,000 293,000 43,400 163,400 $ 197,000 192,000 45,400 As at December 31, Year 3, the equipment and patent had an estimated useful life of six and eight years, respectively. The long-term debt is due on January 1, Year 9. There was a goodwill impairment loss of $3,000 in Year 5. There were no other impairment losses. Mueller uses the cost method to account for its investment in Wilson. The book values of selected accounts for the year ended December 31, Year 7 were as follows: Mueller 13,700 65,400 108,500 284,000 ? ? Wilson $ 29,400 192,000 144,000

FINANCIAL ACCOUNTING
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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Required: (a) Prepare a schedule of changes to the acquisition differential for the four year period ending December 31, Year 7. (Leave no cells blank - be certain to enter "0" wherever required. Omit $ sign in your response. Negative/Deductible amounts should be indicated by a minus sign.) Inventory Equipment (6 years) Patents (8 years) Long-term debt (5 years) Goodwill Balance Dec. 1 Year 3 $ Consolidated net income attributable to the parent Consolidated retained earnings Non-controlling interest Changes Year 4, 5&6 $ $ Year 7 Balance Dec. 31 Year 7 $ (b) Calculate consolidated net income attributable to the parent, ending retained earnings and non-controlling interest at December 31, Year 7. (Omit $ sign in your response.) LA LA LA $
Transcribed Image Text:Required: (a) Prepare a schedule of changes to the acquisition differential for the four year period ending December 31, Year 7. (Leave no cells blank - be certain to enter "0" wherever required. Omit $ sign in your response. Negative/Deductible amounts should be indicated by a minus sign.) Inventory Equipment (6 years) Patents (8 years) Long-term debt (5 years) Goodwill Balance Dec. 1 Year 3 $ Consolidated net income attributable to the parent Consolidated retained earnings Non-controlling interest Changes Year 4, 5&6 $ $ Year 7 Balance Dec. 31 Year 7 $ (b) Calculate consolidated net income attributable to the parent, ending retained earnings and non-controlling interest at December 31, Year 7. (Omit $ sign in your response.) LA LA LA $
On December 31, Year 3, Mueller Corp. acquired 80% of the outstanding shares of Wilson Inc. for a total cost of $276,000. The carrying amount of Wilson's assets, liabilities, and equity was equal to fair value except for the following: Inventory Equipment, net Patent Long-term debt Common shares Retained earnings $ Dividend income Net income Common shares Retained earnings Carrying Amount 61,700 287,000 $ 197,000 192,000 45,400 Fair Value $ 71,400 293,000 43,400 163,400 As at December 31, Year 3, the equipment and patent had an estimated useful life of six and eight years, respectively. The long-term debt is due on January 1, Year 9. There was a goodwill impairment loss of $3,000 in Year 5. There were no other impairment losses. Mueller uses the cost method to account for its investment in Wilson. The book values of selected accounts for the year ended December 31, Year 7 were as follows: ? ? Wilson Mueller 13,700 65,400 $ 29,400 108,500 192,000 284,000 144,000
Transcribed Image Text:On December 31, Year 3, Mueller Corp. acquired 80% of the outstanding shares of Wilson Inc. for a total cost of $276,000. The carrying amount of Wilson's assets, liabilities, and equity was equal to fair value except for the following: Inventory Equipment, net Patent Long-term debt Common shares Retained earnings $ Dividend income Net income Common shares Retained earnings Carrying Amount 61,700 287,000 $ 197,000 192,000 45,400 Fair Value $ 71,400 293,000 43,400 163,400 As at December 31, Year 3, the equipment and patent had an estimated useful life of six and eight years, respectively. The long-term debt is due on January 1, Year 9. There was a goodwill impairment loss of $3,000 in Year 5. There were no other impairment losses. Mueller uses the cost method to account for its investment in Wilson. The book values of selected accounts for the year ended December 31, Year 7 were as follows: ? ? Wilson Mueller 13,700 65,400 $ 29,400 108,500 192,000 284,000 144,000
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