pital Stock and $30,000 of Retained Earnings. The difference between the fair value of Pawl's assets and liabilities and the book value was allocated to a plant asset with a remaining 10-year straight-line life that was overvalued on the books by $5,000. The remainder was attributable to goodwill. The separate company statements for Pawl and Snab appear in the first two columns of the partially completed consolidation working papers.
pital Stock and $30,000 of Retained Earnings. The difference between the fair value of Pawl's assets and liabilities and the book value was allocated to a plant asset with a remaining 10-year straight-line life that was overvalued on the books by $5,000. The remainder was attributable to goodwill. The separate company statements for Pawl and Snab appear in the first two columns of the partially completed consolidation working papers.
pital Stock and $30,000 of Retained Earnings. The difference between the fair value of Pawl's assets and liabilities and the book value was allocated to a plant asset with a remaining 10-year straight-line life that was overvalued on the books by $5,000. The remainder was attributable to goodwill. The separate company statements for Pawl and Snab appear in the first two columns of the partially completed consolidation working papers.
. Pawl Corporation acquired 90% of Snab Corporation on January 1, 2014 for $72,000 cash when Snab's stockholders' equity consisted of $30,000 of Capital Stock and $30,000 of Retained Earnings. The difference between the fair value of Pawl's assets and liabilities and the book value was allocated to a plant asset with a remaining 10-year straight-line life that was overvalued on the books by $5,000. The remainder was attributable to goodwill. The separate company statements for Pawl and Snab appear in the first two columns of the partially completed consolidation working papers.
Required:
Complete the consolidation working papers for Pawl and Snab for the year 2014.
Transcribed Image Text:Eliminations
Consol-
Pawl
Snab
Debit
Credit
idated
INCOME STATEMENT
Sales
60,000
$22,000
Income of Snab
3,510
Cost of Sales
Depreciation
Expense
Other
Expenses
Noncontrolling
Interest Share
13,000)
9,500)
2,000)
3,000)
(23,000)
6,100)
Net income
Retained
Earnings 1/1
Add:
Net income
Less:
Dividends
Retained
Earnings 12/31
BALANCE SHEET
Cash
Accounts
Receivable-net
5.
25,510
$3,400
25,000
$30,000
25,510
3,400
( 15,000) |
3,000)
35,510
$30,400
26,520
$7,000
22,000
10,000
Inventories
20,000
14,000
Land
Equipment and
Buildings-net
Investment in
Snab Corporation
Goodwill
27,000
42,000
70,000
38,000
72,810
$| 238, 330
$111,000
TOTAL ASSETS
LIAB. & EQUITY
Accounts payable $
Capital
Stock
Retained
Earnings
Noncontrolling
Interest
32,820
$50, 600
170,000
30,000
В0, 40
TOTAL LIAB. &
EQUITY
$111,000
238,330
Definition Definition Assets available to stockholders after a company's liabilities are paid off. Stockholders’ equity is also sometimes referred to as owner's equity. A stockholders’ equity or book value generally includes common stock, preferred stock, and retained earnings and is an indicator of a company's financial strength.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
