On January 1, 2016, Pamela Company purchased 75% of the common stock of Snicker Company. Separate balance sheet data for the companies at the combination date are given below: Snicker Snicker Co. Co. Pamela Co. Book Values Fair Values Cash Accounts receivable $ 18,000 $155,000 $155,000 108,000 20,000 20,000 Inventory 99,000 26,000 45,000 Land 60,000 24,000 45,000 Plant assets 525,000 225,000 300,000 Acc. depreciation (180,000) (45,000) Investment in Snicker 330,000 Co Total assets $960,000 $405,000 $565,000 Accounts payable $156,000 $105,000 $105,000 Capital stock 600,000 225,000 Retained earnings 204,000 75,000 Total liabilities & equities $960,000 $405,000 Determine below what the consolidated balance would be for each of the requested accounts on January 2, 2016. What is the amount of consolidated retained earnings? a. $204,000 O b. $209,250 Oc $260,250 O d. $279,000
On January 1, 2016, Pamela Company purchased 75% of the common stock of Snicker Company. Separate balance sheet data for the companies at the combination date are given below: Snicker Snicker Co. Co. Pamela Co. Book Values Fair Values Cash Accounts receivable $ 18,000 $155,000 $155,000 108,000 20,000 20,000 Inventory 99,000 26,000 45,000 Land 60,000 24,000 45,000 Plant assets 525,000 225,000 300,000 Acc. depreciation (180,000) (45,000) Investment in Snicker 330,000 Co Total assets $960,000 $405,000 $565,000 Accounts payable $156,000 $105,000 $105,000 Capital stock 600,000 225,000 Retained earnings 204,000 75,000 Total liabilities & equities $960,000 $405,000 Determine below what the consolidated balance would be for each of the requested accounts on January 2, 2016. What is the amount of consolidated retained earnings? a. $204,000 O b. $209,250 Oc $260,250 O d. $279,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:On January 1, 2016, Pamela Company purchased 75% of the common stock of Snicker Company. Separate balance sheet data for the companies at the combination date are given below:
Snicker
Snicker
Co.
Co.
Pamela Co.
Book
Values
Fair
Values
Cash
Accounts receivable
$ 18,000
$155,000
$155,000
108,000
20,000
20,000
Inventory
99,000
26,000
45,000
Land
60,000
24,000
45,000
Plant assets
525,000
225,000
300,000
Acc. depreciation
(180,000)
(45,000)
Investment in Snicker
330,000
Co
Total assets
$960,000
$405,000
$565,000
Accounts payable
$156,000
$105,000
$105,000
Capital stock
600,000
225,000
Retained earnings
204,000
75,000
Total liabilities &
equities
$960,000
$405,000
Determine below what the consolidated balance would be for each of the requested accounts on January 2, 2016.
What is the amount of consolidated retained earnings?
a. $204,000
O b. $209,250
Oc $260,250
O d. $279,000
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