Petunia Company acquired an 80% interest in Shaman Company in 2016. In 2017 and 2018, Shaman reported netincome of $400,000 and $480,000, respectively. During 2017, Shaman sold $80,000 of merchandise$20,000 profit. Petunia sold the merchandise to outsiders during 2018 for $140,000.to PetuniaFor consolidationfor apurposes, whatis the noncontrolling interest's share of Shaman's 2017 and 2018 net income?

Answer:- Non-controlling interest meaning:- An owner of less than 50 percent of the shares in a…

Answered: Petunia Company acquired an 80%…

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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Premier Inc. acquired a 42% interest in Jungle Vine Inc. (JV) for $86,000 cash on January 1, 2017 when JV had retained earnings of $100,000. On purchase of shares of JV, the acquisition differential schedule relating to Premier's share of JV was: Equipment $10,000 Goodwill $35,000 $45,000 Equipment was expected to last five more years from date of acquisition and is still owned at year end. Goodwill was written down by $5,000 in 2018. In 2019, Premier sold JV land, reporting a gain of $20,000. JV still has the land. In 2019, JV sold Premier inventory for $30,000 reporting a profit of $6,000. $15,000 of the inventory was still held by Premier at the end of 2019 and sold early in 2020. In 2020, JV reported net income of $35,000 and declared and paid total dividends of $15,000. At December 31, 2020, JV had retained earnings of $160,000. Calculate the equity method income related to Jv for 2020 reported by Premier.
Davis acquires 100% of Ramos on January 1, 2009, Ramos will be operated as a separate subsidiary. Davis will use the equity method to account for its investment in Ramos. In 2013, Davis has net income of $400,000 and pays dividends of $100,000. Ramos has net income of $200,000 and pays dividends of $75,000. At acquisition date, Davis has a building with a book value of $3,000,000 and a fair value of $4,000,000. At that date, Ramos had a building witha book value of $800,000 and fair value of $900,000. Both buildings have a remaining useful life of 5 years (assume straight line depreciation). At Dec. 3, 2013 Davis had book value of building of 5,000,000 and Fair Value of 6,000,000.Ramos had book value building of 2,000,000 and fair value of 1,500,000 a. Prepare consolidation worksheet "D" to reflect the necessary adjustment for dividends. b. How much are consolidated dividends for 2013 c. Prepare worksheet entry "A" at December 31, 2013 (assume there is no goodwill). d. How much is…
Davis acquires 100% of Ramos on January 1st, 2009. Ramos will be operated as a separate subsidiary. Davis will use the equity method to account for its investment in Ramos. In 2013, Davis has net income of $400,000 and pays dividends of $100,000. Ramos has NI of $200,000 and pays dividends of $75,000. At acquisition date, Davis has a building with a. BV of $800,000 and FV of $900,000. Both buildings have a remaining useful life of 10 years (assume straight line depreciation). At December 31, 2013 Davis had book value (BV) of Building of 5,000,000 and fair value (FV) of 6,000,000. Ramos had BV of Building of 2,000,000 and FV of 1,500,000. A) Prepare Consolidation worksheet D to reflect the necessary adjustment for dividends. B) How much are consolidated dividends for 2013 C) Prepare worksheet entry A at December 31, 2013(assume there is no goodwill)
CASE 1 Presented below are the financial balances for the BonGiovi Company and the Terens Company as of December 31, 2017, immediately before BonGiovi acquired Terens. Also included are the fair values for Terens Company's net assets at that date (thousands of US$). Terens Compute consolidated retained earnings as a result of this acquisition. A) $1,160. Compute consolidated revenues immediately following the acquisition. BonGiovi Book Value Terens Book Value B) $1,170. 31.12.2017 31.12.2017 Fair Value 31.12.2017 C) $1,265. Cash 870 240 240 Receivables 660 600 600 D) $1,280. Inventory 1,230 420 580 Land 1,800 260 250 E) $1,650. Buildings (Net) 1,800 540 650 Equipment (net) 660 380 400 Accounts Payable (570) (240) (240) Accrued expenses (270) (60) Long term Liabilities (2,700) (1,020) (60) (1,120) Common Stock (1,980) A) $3,540. ($20par) B) $2,880. Common Stock ($5 (420) par) C) $1,170. Additional paid in (210) (180) capital D) $1,650. Retained earnings (1,170) (480) Revenue (2,880)…

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