On June 30, 2021, Plaster, Inc., paid $988,000 for 80 percent of Stucco Company's outstanding stock. Plaster assessed theacquisition-date fair value of the 20 percent noncontrolling interest at $247,000. At acquisition date. Stucco reported the followingbook values for its assets and liabilities:CashAccounts receivableInventoryLandBuildingsEquipmentAccounts payable(Parentheses indicate credit balances.)On June 30, Plaster allocated the excess acquisition-date fair value over book value to Stucco's assets as follows:$ 64,500136,900219, 20070,400189,400324,300(37,700)Equipment (3-year remaining life)Database (10-year remaining life)CashAccounts receivable (net)InventoryLandAt the end of 2021, the following comparative (2020 and 2021) balance sheets and consolidated income statement were available:Plaster, Inc.December 31,2020Buildings (net)Equipment (net)DatabaseTotal assetsAccounts payableLong-term liabilitiesCommon stockNoncontrolling interestRetained earningsTotal liabilities and equitiesRevenuesCost of goods soldDepreciation$Database amortizationInterest and other expensesConsolidated net income$ 80,400187,60045,700384,500441,100318,900260,3001,912,5008$ 3,363,000$85,400427,0001,921,500PLASTER, INC., AND SUBSIDIARY STUCCO COMPANYConsolidated Income StatementFor the Year Ended December 31, 2021$ 785,200199,2009,38010,6008929,100$ 3,363,000ConsolidatedDecember 31,2821258,100515,900764,900389, 300$399,7002,168,000178,220$ 4,674,120114,2001,351,5401,921,500272,6001,014,280$ 4,674,120$ 1,296,6001,004,380$ 292, 220Additional Information for 2021• On December 1, Stucco paid a $47,200 dividend. During the year, Plaster paid $172,000 in dividends.. During the year, Plaster issued $924,540 in long-term debt at par.Plaster reported no asset purchases or dispositions other than the acquisition of Stucco. Prepare a 2021 consolidated statement of cash flows for Plaster and Stucco. Use the indirect method of reporting cash flows fromoperating activities. (Negative amounts and amounts to be deducted should be Indicated by a minus sign.)PLASTER, INC., AND SUBSIDIARY STUCCO COMPANYConsolidated Statement of Cash FlowsFor the Year Ended December 31, 2021Cash flows from operating activities:Consolidated net incomeDepreciation expenseAmortization expenseDecrease in accounts receivableIncrease in inventoryDecrease in accounts payableNet cash flow provided by operating activitiesCash flows from investing activities:Purchase of Stucco Company assetsNet cash flow used in investing activitiesCash flows from financing activities:Issue long-term debtDividends paidNet cash flow provided by financing activitiesIncrease in cash 1/1/21 to 12/31/21Beginning cash, 1/1/21Ending cash, 12/31/21199,2009,3805,500(104,600)(8.900)(923,500)924,540(181,440)$$$$$292,220100,580392,800(923,500)743,100212,40045,700258,100

According to the given question, we are required to prepare the consolidated statement of cash…

On June 30, 2021, Plaster, Inc., paid $988,000 for 80 percent of Stucco Company's outstanding stock. Plaster assessed the acquisition-date fair value of the 20 percent noncontrolling interest at $247,000. At acquisition date. Stucco reported the following book values for its assets and liabilities: Cash Accounts receivable Inventory Land Buildings Equipment Accounts payable (Parentheses indicate credit balances.) On June 30, Plaster allocated the excess acquisition-date fair value over book value to Stucco's assets as follows: Equipment (3-year remaining life) Database (18-year remaining life) Cash Accounts receivable (net) Inventory Land $ 64,500 136,900 219,200 78,480 189,480 324,300 (37,780) At the end of 2021, the following comparative (2020 and 2021) balance sheets and consolidated income statement were available: Plaster, Inc. December 31, 2020 Buildings (net) Equipment (net) Database Total assets Accounts payable Long-term liabilities Common stock Noncontrolling interest Retained earnings Total liabilities and equities Revenues Cost of goods sold Depreciation $ 80,400 187,600 Database amortization Interest and other expenses Consolidated net income 45,700 384,500 441,100 318,900 260,300 1,912,500 e $ 3,363,000 $ 85,400 427,000 1,921,500 PLASTER, INC., AND SUBSIDIARY STUCCO COMPANY Consolidated Income Statement For the Year Ended December 31, 2821 $ 785,200 199,200 9,380 10,600 e 929,100 $ 3,363,000 Consolidated December 31, 2021 258,100 515,900 $ 764,900 389,300 399,700 2,168,000 178,220 $ 4,674,120 $ 114,200 1,351,540 1,921,500 272,600 1,014,280 $ 4,674,120 $ 1,296,600 1,004,380 $ 292,220 Additional Information for 2021 • On December 1, Stucco paid a $47,200 dividend. During the year, Plaster paid $172,000 in dividends. . During the year, Plaster issued $924,540 in long-term debt at par.

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q