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Problem 08-10 (LO2) On January 1, Year 5, Pic Company acquired 7,500 ordinary shares of Sic Company for $825,000. On January 1, Year 6, Pic Company acquired an additional 2,000 ordinary shares of Sic Company for $207000. On January 1, Year 5, the shareholders' equity of Sic was as follows: Ordinary shares (10,000 no par value shares issued) Ketained earnings $200, 000 309, 000 $509, 000 The following are the statements of retained earmings for the two companies for Years 5 and 6: Pie Year 5 $ S18,000 141,500 (100,000) $ 559,500 Sie Year S $ 309,000 139,000 (90,000) Retained earnings, beginning of year Year 6 Year 6 $ 559, 500 149, 500 (120, 000) $ 589,000 $ 358, 000 Profit 201,000 Dividends Retained earnings, end of year (00, 000) $ 358,000 $ 469, 000 Additional Information • Pic uses the cost method to account for its Investment in Sic. • Any acquisition differential is allocated to customer contracts, which are expected to provide future benefits until December 31, Year 7. Neither company has any customer contracts recorded on their separate-entity records. • There were no unrealized profits from intercompany transactions since the date of acquisition. Required: (n) Calculate consolidated profit attributable to Pic's shareholders for Year 6. (Omit S sign in your response.)

Problem 08-10 (LO2) On January 1, Year 5, Pic Company acquired 7,500 ordinary shares of Sic Company for $825,000. On January 1, Year 6, Pic Company acquired an additional 2,000 ordinary shares of Sic Company for $207000. On January 1, Year 5, the shareholders' equity of Sic was as follows: Ordinary shares (10,000 no par value shares issued) Ketained earnings $200, 000 309, 000 $509, 000 The following are the statements of retained earmings for the two companies for Years 5 and 6: Pie Year 5 $ S18,000 141,500 (100,000) $ 559,500 Sie Year S $ 309,000 139,000 (90,000) Retained earnings, beginning of year Year 6 Year 6 $ 559, 500 149, 500 (120, 000) $ 589,000 $ 358, 000 Profit 201,000 Dividends Retained earnings, end of year (00, 000) $ 358,000 $ 469, 000 Additional Information • Pic uses the cost method to account for its Investment in Sic. • Any acquisition differential is allocated to customer contracts, which are expected to provide future benefits until December 31, Year 7. Neither company has any customer contracts recorded on their separate-entity records. • There were no unrealized profits from intercompany transactions since the date of acquisition. Required: (n) Calculate consolidated profit attributable to Pic's shareholders for Year 6. (Omit S sign in your response.)

FINANCIAL ACCOUNTING
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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The following are the statements of retained earnings for the two companies for Years 5 and 6: Pic Sic Retained earnings, beginning of year Profit Dividends Year S $ 518,000 141,500 (100,000) $ 559,500 Year 6 $ 559, 500 149,500 (120, 00e) $ 589,000 Yeur 5 Yeur 6 $ 309, 00 $ 358,000 201,000 (90, 000) $ 469,000 139, 000 (98, 000) $ 358,000 Retained earnings, end of year Additional Information • Pic uses the cost method to account for its investment in Sic. • Any acquisition differential is allocated to customer contracts, which are expected to provide future benefits until December 31, Year Z. Neither company has any customer contracts recorded on their separate entity records. • There were no unrealized profits from intercompany transactions since the date of acquisition. Required: (a) Calculate consolidated profit attributable to Pic's shareholders for Year 6. (Omit $ sign in your response.) Consolidated profit attributable to Pic's shareholders (b) Calculate the following account balances for the consolidated statement of financial position at December 31, Year 6: (Omit $ sign in your response.) (4) Customer contracts (41) Mon-controlling interest (ii4) Retained earnings
Transcribed Image Text:The following are the statements of retained earnings for the two companies for Years 5 and 6: Pic Sic Retained earnings, beginning of year Profit Dividends Year S $ 518,000 141,500 (100,000) $ 559,500 Year 6 $ 559, 500 149,500 (120, 00e) $ 589,000 Yeur 5 Yeur 6 $ 309, 00 $ 358,000 201,000 (90, 000) $ 469,000 139, 000 (98, 000) $ 358,000 Retained earnings, end of year Additional Information • Pic uses the cost method to account for its investment in Sic. • Any acquisition differential is allocated to customer contracts, which are expected to provide future benefits until December 31, Year Z. Neither company has any customer contracts recorded on their separate entity records. • There were no unrealized profits from intercompany transactions since the date of acquisition. Required: (a) Calculate consolidated profit attributable to Pic's shareholders for Year 6. (Omit $ sign in your response.) Consolidated profit attributable to Pic's shareholders (b) Calculate the following account balances for the consolidated statement of financial position at December 31, Year 6: (Omit $ sign in your response.) (4) Customer contracts (41) Mon-controlling interest (ii4) Retained earnings
Problem 08-10 (LO2) On January 1, Year 5, Pic Company acquired 7,500 ordinary shares of Sic Company for $825,000. On January 1, Year 6, Pic Company acquired an additional 2,000 ordinary shares of Sic Company for $207000. On January 1, Year 5, the shareholders' equity of Sic was as follows: Ordinary shares (10,000 no par value shares issued) Retained earnings $200, 800 309, 000 $s09, 000 The following are the statements of retained earnings for the two companies for Years 5 and 6: Pic Sic Year 5 Year 6 Year 5 Year 6 Retained earnings, beginning of year Profit $ 518,000 141,500 (100,000) $ 559,500 $ 559,500 149, 500 (120, 000) $ 589, 000 $ 309,000 139,800 (90,000) $ 358,000 $ 358, 000 201,000 (90, 000) $ 469,000 Dividends Retained earnings, end of year Additional Information • Pic uses the cost method to account for its Investment in Sic. Any acquisition differential is allocated to customer contracts, which are expected to provide future benefits until December 31, Year 7. Neither company has any customer contracts recorded on their separate-entity records. • There were no unrealized profits from intercompany transactions since the date of acquisition. Required: (n) Calculate consolidated profit attributable to Pic's shareholders for Year 6. (Omit $ sign in your response.)
Transcribed Image Text:Problem 08-10 (LO2) On January 1, Year 5, Pic Company acquired 7,500 ordinary shares of Sic Company for $825,000. On January 1, Year 6, Pic Company acquired an additional 2,000 ordinary shares of Sic Company for $207000. On January 1, Year 5, the shareholders' equity of Sic was as follows: Ordinary shares (10,000 no par value shares issued) Retained earnings $200, 800 309, 000 $s09, 000 The following are the statements of retained earnings for the two companies for Years 5 and 6: Pic Sic Year 5 Year 6 Year 5 Year 6 Retained earnings, beginning of year Profit $ 518,000 141,500 (100,000) $ 559,500 $ 559,500 149, 500 (120, 000) $ 589, 000 $ 309,000 139,800 (90,000) $ 358,000 $ 358, 000 201,000 (90, 000) $ 469,000 Dividends Retained earnings, end of year Additional Information • Pic uses the cost method to account for its Investment in Sic. Any acquisition differential is allocated to customer contracts, which are expected to provide future benefits until December 31, Year 7. Neither company has any customer contracts recorded on their separate-entity records. • There were no unrealized profits from intercompany transactions since the date of acquisition. Required: (n) Calculate consolidated profit attributable to Pic's shareholders for Year 6. (Omit $ sign in your response.)
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