Parrot Company purchased 90% of the outstanding voting shares of Sieger Company at the beginning of 2018 for $650,000. At the time of purchase, Song Company's total stockholders' equity amounted to $625,000. Income and dividend distributions for Sieger Company from 2018 through 2020 are as follows (please see the table below). Please use the complete equity method to record the Parrot company's investment. The difference between book value of equity acquired and the value implied by the purchase price was attributed solely to an excess of market over book values of depreciable assets, with a remaining life of 5 years. $ 2018 2019 2020 -55,000 35,000 Net income (loss) 63,500 52,500 Dividend Distribution 25,000 50,000 2020 -55,000 35,000 2018 2019 Net income (loss) 63,500 52,500 Dividend Distribution 25,000 50,000

Parrot Company purchased 90% of the outstanding voting shares of Sieger Company at the beginning of 2018 for $650,000. At the time of purchase, Song Company's total stockholders' equity amounted to $625,000. Income and dividend distributions for Sieger Company from 2018 through 2020 are as follows (please see the table below). Please use the complete equity method to record the Parrot company's investment. The difference between book value of equity acquired and the value implied by the purchase price was attributed solely to an excess of market over book values of depreciable assets, with a remaining life of 5 years. $ 2018 2019 2020 -55,000 35,000 Net income (loss) 63,500 52,500 Dividend Distribution 25,000 50,000 2020 -55,000 35,000 2018 2019 Net income (loss) 63,500 52,500 Dividend Distribution 25,000 50,000

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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