ProForm acquired 60 percent of ClipRite on June 30, 2020, for $660,000 in cash. Based on ClipRite's acquisition-date fair value, anunrecorded intangible of $720,000 was recognized and is being amortized at the rate of $18,000 per year. No goodwill wasrecognized in the acquisition. The noncontrolling interest fair value was assessed at $440,000 at the acquisition date. The 2021financial statements are as follows:SalesCost of goods soldOperating expensesDividend incomeNet incomeRetained earnings, 1/1/21Net incomeDividends declaredRetained earnings,12/31/21Cash and receivablesInventoryInvestment in ClipRiteFixed assetsAccumulated depreciationTotalsLiabilitiesCommon stockRetained earnings, 12/31/21TotalsProForm(930,000)600,000230,000(30,000)$ (130,000) $ (230,000)SalesCost of Goods SoldOperating Expenses$(1,700,000)(130,000)230,000$(1,600,000)ClipRite(860,000)465,000165,0000$ (980,000)(230,000)50,000$(1,160,000)$ 530,000 $ 430,000830,0000420,000660,0001,200,000(200,000)1,250,000(400,000)$ 2,610,000$ 2,110,000$ (310,000) $ (250,000)(700,000)(1,600,000)(700,000)(1,160,000)$(2,610,000)$(2,110,000)(Note: Parentheses indicate a credit balance.)ProForm sold ClipRite inventory costing $82,000 during the last six months of 2020 for $220,000. At year-end, 30 percent remained.ProForm sold ClipRite Inventory costing $265,000 during 2021 for $380,000. At year-end, 10 percent is left.Determine the consolidated balances for the following accounts: (Input all amounts as positive values.) Determine the consolidated balances for the following accounts: (Input all amounts as positive values.)SalesCost of Goods SoldOperating ExpensesDividend IncomeNet Income Attributable to Noncontrolling InterestInventoryNoncontrolling Interest in Subsidiary, 12/31/21Answer is complete but not entirely correct.SalesCost of goods soldOperating expensesDividend incomeNet income attributable to noncontrollinginterestInventoryNoncontrolling interest in subsidiary, 12/31/21ConsolidatedBalance$$$$$$$1,410,000655,100413,0001096,7601,238,500948,600

It is often referred as 'Minority interest'. It is the percentage of ownership lower than 50% of…

ProForm acquired 60 percent of ClipRite on June 30, 2020, for $660,000 in cash. Based on ClipRite's acquisition-date fair value, an unrecorded intangible of $720,000 was recognized and is being amortized at the rate of $18,000 per year. No goodwill was recognized in the acquisition. The noncontrolling interest fair value was assessed at $440,000 at the acquisition date. The 2021 financial statements are as follows:

ProForm acquired 60 percent of ClipRite on June 30, 2020, for $660,000 in cash. Based on ClipRite's acquisition-date fair value, an unrecorded intangible of $720,000 was recognized and is being amortized at the rate of $18,000 per year. No goodwill was recognized in the acquisition. The noncontrolling interest fair value was assessed at $440,000 at the acquisition date. The 2021 financial statements are as follows:

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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