On January 1, 2017, Parker Company purchased 95% of the outstanding common stock of Sid Company for $160,000. At that time, Sid's stockholders' equity consisted of common stock, $120,000; other contributed capital, $10,000; and retained earnings, $23,000. On December 31, 2017, the two companies' trial balances were as follows: Cash Accounts Receivable Inventory Investment in Sid Company Plant and Equipment Land Dividends Declared Cost of Goods Sold Operating Expenses Total Debits Accounts Payable Other Liabilities Common Stock Other Contributed Capital Retained Earnings, 1/1 Sales Dividend Income. Total Credits Parker $ 62,000 32,000 30,000 160,000 -0- 82,000 34,000 20,000 130,000 40,000 20,000 14.000 $588,000 $265,000 $ 19,000 105,000 29,000 20,000 Sid $30,000 29,000 16,000 Required: A. Prepare a consolidated statements workpaper on December 31, 2017. B. Prepare a consolidated statements workpaper on December 31, 2018, assuming trial balances for Parker and Sid on that date were: $ 12,000 20,000 120,000 10,000 23,000 80,000 10,000 180,000 60,000 40,000 260,000 19.000 -0- $588,000 $265,000 4

On January 1, 2017, Parker Company purchased 95% of the outstanding common stock of Sid Company for $160,000. At that time, Sid's stockholders' equity consisted of common stock, $120,000; other contributed capital, $10,000; and retained earnings, $23,000. On December 31, 2017, the two companies' trial balances were as follows: Cash Accounts Receivable Inventory Investment in Sid Company Plant and Equipment Land Dividends Declared Cost of Goods Sold Operating Expenses Total Debits Accounts Payable Other Liabilities Common Stock Other Contributed Capital Retained Earnings, 1/1 Sales Dividend Income. Total Credits Parker $ 62,000 32,000 30,000 160,000 -0- 82,000 34,000 20,000 130,000 40,000 20,000 14.000 $588,000 $265,000 $ 19,000 105,000 29,000 20,000 Sid $30,000 29,000 16,000 Required: A. Prepare a consolidated statements workpaper on December 31, 2017. B. Prepare a consolidated statements workpaper on December 31, 2018, assuming trial balances for Parker and Sid on that date were: $ 12,000 20,000 120,000 10,000 23,000 80,000 10,000 180,000 60,000 40,000 260,000 19.000 -0- $588,000 $265,000 4

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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