ProForm acquired 70 percent of ClipRite on June 30, 2020, for $770,000 in cash. Based on ClipRite's acquisition-date fair value, an unrecorded intangible of $480,000 was recognized and is being amortized at the rate of $12,000 per year. No goodwill was recognized in the acquisition. The noncontrolling interest fair value was assessed at $330,000 at the acquisition date. The 2021 financial statements are as follows: ProForm ClipRite Sales $ (820,000 ) $ (640,000 ) Cost of goods sold 545,000 410,000 Operating expenses 120,000 110,000 Dividend income (49,000 ) 0 Net income $ (204,000 ) $ (120,000 ) Retained earnings, 1/1/21 $ (1,100,000 ) $ (870,000 ) Net income (204,000 ) (120,000 ) Dividends declared 120,000 70,000 Retained earnings, 12/31/21 $ (1,184,000 ) $ (920,000 ) Cash and receivables $ 420,000 $ 320,000 Inventory 310,000 720,000 Investment in ClipRite 770,000 0 Fixed assets 1,200,000 700,000 Accumulated depreciation (400,000 ) (300,000 ) Totals $ 2,300,000 $ 1,440,000 Liabilities $ (816,000 ) $ (220,000 ) Common stock (300,000 ) (300,000 ) Retained earnings, 12/31/21 (1,184,000 ) (920,000 ) Totals $ (2,300,000 ) $ (1,440,000 ) (Note: Parentheses indicate a credit balance.) ProForm sold ClipRite inventory costing $71,000 during the last six months of 2020 for $110,000. At year-end, 30 percent remained. ProForm sold ClipRite inventory costing $210,000 during 2021 for $270,000. At year-end, 10 percent is left. Determine the consolidated balances for the following accounts: (Input all amounts as positive values.) Sales Cost of Goods Sold Operating Expenses Dividend Income Net Income Attributable to Noncontrolling Interest Inventory Noncontrolling Interest in Subsidiary, 12/31/21

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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ProForm acquired 70 percent of ClipRite on June 30, 2020, for $770,000 in cash. Based on ClipRite's acquisition-date fair value, an unrecorded intangible of $480,000 was recognized and is being amortized at the rate of $12,000 per year. No goodwill was recognized in the acquisition. The noncontrolling interest fair value was assessed at $330,000 at the acquisition date. The 2021 financial statements are as follows:

		ProForm			ClipRite
Sales	$	(820,000	)	$	(640,000	)
Cost of goods sold		545,000			410,000
Operating expenses		120,000			110,000
Dividend income		(49,000	)		0
Net income	$	(204,000	)	$	(120,000	)
Retained earnings, 1/1/21	$	(1,100,000	)	$	(870,000	)
Net income		(204,000	)		(120,000	)
Dividends declared		120,000			70,000
Retained earnings, 12/31/21	$	(1,184,000	)	$	(920,000	)
Cash and receivables	$	420,000		$	320,000
Inventory		310,000			720,000
Investment in ClipRite		770,000			0
Fixed assets		1,200,000			700,000
Accumulated depreciation		(400,000	)		(300,000	)
Totals	$	2,300,000		$	1,440,000
Liabilities	$	(816,000	)	$	(220,000	)
Common stock		(300,000	)		(300,000	)
Retained earnings, 12/31/21		(1,184,000	)		(920,000	)
Totals	$	(2,300,000	)	$	(1,440,000	)

(Note: Parentheses indicate a credit balance.)

ProForm sold ClipRite inventory costing $71,000 during the last six months of 2020 for $110,000. At year-end, 30 percent remained. ProForm sold ClipRite inventory costing $210,000 during 2021 for $270,000. At year-end, 10 percent is left.

Determine the consolidated balances for the following accounts: (Input all amounts as positive values.)

Sales
Cost of Goods Sold
Operating Expenses
Dividend Income
Net Income Attributable to Noncontrolling Interest
Inventory
Noncontrolling Interest in Subsidiary, 12/31/21

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