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ProForm acquired 60 percent of ClipRite on June 30, 2023, for $660,000 in cash. Based on ClipRite's acquisition-date fair value, an unrecorded intangible of $550,000 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 2024 financial statements are as follows: Items Sales Cost of goods sold Operating expenses Dividend income Net income Retained earnings, 1/1/24 Net income Dividends declared Retained earnings, 12/31/24 Cash and receivables ProForm ClipRite $ (930,000) $ (860,000) 600,000 230,000 (30,000) 465,000 165,000 0 $ (130,000) $ (230,000) $ $ (980,000) (1,700,000) (130,000) (230,000) 230,000 (1,600,000) (1,160,000) 50,000 $ $ $ 530,000 $ 430,000 420,000 830,000 660,000 0 1,200,000 1,250,000 (200,000) (400,000) $ $ 2,610,000 2,110,000 Inventory Investment in ClipRite Fixed assets Accumulated depreciation Totals Liabilities Common stock Retained earnings, 12/31/24 Totals $ (310,000) $ (250,000) (700,000) (700,000) (1,600,000) (1,160,000) $ $ (2,610,000) (2,110,000) Note: Parentheses indicate a credit balance. ClipRite sold ProForm inventory costing $82,000 during the last six months of 2023 for $220,000. At year-end, 30 percent remained. ClipRite sold ProForm inventory costing $265,000 during 2024 for $380,000. At year-end, 10 percent is left. Required: With these facts, determine the consolidated balances for the following: Note: Input all amounts as positive values. Answer is complete but not entirely correct. Consolidated Balance Sales $ 1,410,000 Cost of goods sold $ 655,100 Operating expenses $ 413,000 Dividend income $ Net income attributable to noncontrolling $ 84,800× interest Inventory $ 1,238,500 Noncontrolling interest in subsidiary, $ 697,100X 12/31/24

ProForm acquired 60 percent of ClipRite on June 30, 2023, for $660,000 in cash. Based on ClipRite's acquisition-date fair value, an unrecorded intangible of $550,000 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 2024 financial statements are as follows: Items Sales Cost of goods sold Operating expenses Dividend income Net income Retained earnings, 1/1/24 Net income Dividends declared Retained earnings, 12/31/24 Cash and receivables ProForm ClipRite $ (930,000) $ (860,000) 600,000 230,000 (30,000) 465,000 165,000 0 $ (130,000) $ (230,000) $ $ (980,000) (1,700,000) (130,000) (230,000) 230,000 (1,600,000) (1,160,000) 50,000 $ $ $ 530,000 $ 430,000 420,000 830,000 660,000 0 1,200,000 1,250,000 (200,000) (400,000) $ $ 2,610,000 2,110,000 Inventory Investment in ClipRite Fixed assets Accumulated depreciation Totals Liabilities Common stock Retained earnings, 12/31/24 Totals $ (310,000) $ (250,000) (700,000) (700,000) (1,600,000) (1,160,000) $ $ (2,610,000) (2,110,000) Note: Parentheses indicate a credit balance. ClipRite sold ProForm inventory costing $82,000 during the last six months of 2023 for $220,000. At year-end, 30 percent remained. ClipRite sold ProForm inventory costing $265,000 during 2024 for $380,000. At year-end, 10 percent is left. Required: With these facts, determine the consolidated balances for the following: Note: Input all amounts as positive values. Answer is complete but not entirely correct. Consolidated Balance Sales $ 1,410,000 Cost of goods sold $ 655,100 Operating expenses $ 413,000 Dividend income $ Net income attributable to noncontrolling $ 84,800× interest Inventory $ 1,238,500 Noncontrolling interest in subsidiary, $ 697,100X 12/31/24

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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ProForm acquired 60 percent of ClipRite on June 30, 2023, for $660,000 in cash. Based on ClipRite's acquisition-date fair value, an unrecorded intangible of $550,000 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 2024 financial statements are as follows: Items Sales Cost of goods sold Operating expenses Dividend income Net income Retained earnings, 1/1/24 Net income Dividends declared Retained earnings, 12/31/24 Cash and receivables ProForm ClipRite $ (930,000) $ (860,000) 600,000 230,000 (30,000) 465,000 165,000 0 $ (130,000) $ (230,000) $ $ (980,000) (1,700,000) (130,000) (230,000) 230,000 (1,600,000) (1,160,000) 50,000 $ $ $ 530,000 $ 430,000 420,000 830,000 660,000 0 1,200,000 1,250,000 (200,000) (400,000) $ $ 2,610,000 2,110,000 Inventory Investment in ClipRite Fixed assets Accumulated depreciation Totals Liabilities Common stock Retained earnings, 12/31/24 Totals $ (310,000) $ (250,000) (700,000) (700,000) (1,600,000) (1,160,000) $ $ (2,610,000) (2,110,000) Note: Parentheses indicate a credit balance. ClipRite sold ProForm inventory costing $82,000 during the last six months of 2023 for $220,000. At year-end, 30 percent remained. ClipRite sold ProForm inventory costing $265,000 during 2024 for $380,000. At year-end, 10 percent is left. Required: With these facts, determine the consolidated balances for the following: Note: Input all amounts as positive values. Answer is complete but not entirely correct. Consolidated Balance Sales $ 1,410,000 Cost of goods sold $ 655,100 Operating expenses $ 413,000 Dividend income $ Net income attributable to noncontrolling $ 84,800× interest Inventory $ 1,238,500 Noncontrolling interest in subsidiary, $ 697,100X 12/31/24
Transcribed Image Text:ProForm acquired 60 percent of ClipRite on June 30, 2023, for $660,000 in cash. Based on ClipRite's acquisition-date fair value, an unrecorded intangible of $550,000 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 2024 financial statements are as follows: Items Sales Cost of goods sold Operating expenses Dividend income Net income Retained earnings, 1/1/24 Net income Dividends declared Retained earnings, 12/31/24 Cash and receivables ProForm ClipRite $ (930,000) $ (860,000) 600,000 230,000 (30,000) 465,000 165,000 0 $ (130,000) $ (230,000) $ $ (980,000) (1,700,000) (130,000) (230,000) 230,000 (1,600,000) (1,160,000) 50,000 $ $ $ 530,000 $ 430,000 420,000 830,000 660,000 0 1,200,000 1,250,000 (200,000) (400,000) $ $ 2,610,000 2,110,000 Inventory Investment in ClipRite Fixed assets Accumulated depreciation Totals Liabilities Common stock Retained earnings, 12/31/24 Totals $ (310,000) $ (250,000) (700,000) (700,000) (1,600,000) (1,160,000) $ $ (2,610,000) (2,110,000) Note: Parentheses indicate a credit balance. ClipRite sold ProForm inventory costing $82,000 during the last six months of 2023 for $220,000. At year-end, 30 percent remained. ClipRite sold ProForm inventory costing $265,000 during 2024 for $380,000. At year-end, 10 percent is left. Required: With these facts, determine the consolidated balances for the following: Note: Input all amounts as positive values. Answer is complete but not entirely correct. Consolidated Balance Sales $ 1,410,000 Cost of goods sold $ 655,100 Operating expenses $ 413,000 Dividend income $ Net income attributable to noncontrolling $ 84,800× interest Inventory $ 1,238,500 Noncontrolling interest in subsidiary, $ 697,100X 12/31/24
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