On January 1, 20X4, Potter Corporation acquired 90 percent of Shoemaker Company's voting stock, at underlying book value. The fair value of the noncontrolling interest was equal to 10 percent of the book value of Shoemaker at that date. Potter uses the fully adjusted equity method in accounting for its ownership of Shoemaker. On December 31, 20X5, the trial balances of the two companies are as follows: Item Current Assets Depreciable Assets Investment in Shoemaker Corporation Depreciation Expense other Expenses Dividends Declared Accumulated Depreciation Current Liabilities Long-Term Debt Common Stock Retained Earnings Sales Income from subsidiary Potter Company Debit $ 200,000 350,000 162,000 27,000 95,000 20,000 $854,000 Credit $ 118,000 100,000 100,000 100,000 150,000 250,000 36,000 $854,000 Shoemaker Corporation Debit $ 140,000 250,000 10,000 60,000 10,000 $ 470,000 Credit $80,000 80,000 50,000 50,000 100,000 110,000 $ 470,000 Based on the preceding information, what amount would be reported as total stockholders' equity in the consolidated balance sheet at Decemb 31, 20X5?
On January 1, 20X4, Potter Corporation acquired 90 percent of Shoemaker Company's voting stock, at underlying book value. The fair value of the noncontrolling interest was equal to 10 percent of the book value of Shoemaker at that date. Potter uses the fully adjusted equity method in accounting for its ownership of Shoemaker. On December 31, 20X5, the trial balances of the two companies are as follows: Item Current Assets Depreciable Assets Investment in Shoemaker Corporation Depreciation Expense other Expenses Dividends Declared Accumulated Depreciation Current Liabilities Long-Term Debt Common Stock Retained Earnings Sales Income from subsidiary Potter Company Debit $ 200,000 350,000 162,000 27,000 95,000 20,000 $854,000 Credit $ 118,000 100,000 100,000 100,000 150,000 250,000 36,000 $854,000 Shoemaker Corporation Debit $ 140,000 250,000 10,000 60,000 10,000 $ 470,000 Credit $80,000 80,000 50,000 50,000 100,000 110,000 $ 470,000 Based on the preceding information, what amount would be reported as total stockholders' equity in the consolidated balance sheet at Decemb 31, 20X5?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Required information
On January 1, 20X4, Potter Corporation acquired 90 percent of Shoemaker Company's voting stock, at underlying book
value. The fair value of the noncontrolling interest was equal to 10 percent of the book value of Shoemaker at that date.
Potter uses the fully adjusted equity method in accounting for its ownership of Shoemaker. On December 31, 20X5, the
trial balances of the two companies are as follows:
Item
Current Assets
Depreciable Assets
Investment in Shoemaker Corporation
Depreciation Expense
other Expenses
Dividends Declared
Accumulated Depreciation
Current Liabilities.
Long-Term Debt
Common Stock
Retained Earnings
Sales
Income from Subsidiary
Potter Company
Debit
$ 200,000
350,000
162,000
27,000
95,000
20,000
$854,000
Credit
$ 118,000
100,000
100,000
100,000
150,000
250,000
36,000
$854,000
Shoemaker Corporation
Debit
$ 140,000
250,000
10,000
60,000
10,000
$ 470,000
Credit
$80,000
80,000
50,000
50,000
100,000
110,000
$ 470,000
Based on the preceding information, what amount would be reported as total stockholders equity in the consolidated balance sheet at December
31, 20X5?
Transcribed Image Text:Based on the preceding information, what amount would be reported as total stockholders equity in the consolidated balance sheet at December
31, 20X5?
Multiple Choice
$412,000
$394,000
$542.000
$348,000
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