Protrade Corporation acquired 80 percent of the outstanding voting stock of Seacraft Company on January 1, 2017, for $612,000 in cash and other consideration. At the acquisition date, Protrade assessed Seacraft’s identifiable assets and liabilities at a collective net fair value of $765,000 and the fair value of the 20 percent noncontrolling interest was $153,000. No excess fair value over book value amortization accompanied the acquisition.The following selected account balances are from the individual financial records of these two companies as of December 31, 2018: Protrade Seacraft Sales $880000 $600000 Cost of goods sold 410000 317000 Operating expenses 174000 129000 Retained earnings, 1/1/18 980000 420000 Inventory 370000 144000 Buildings (net) 382000 181000 Investment income not given -0- Each of the following problems is an independent situation:a. Assume that Protrade sells Seacraft inventory at a markup equal to 60 percent of cost. Intra-entity transfers were $114,000 in 2017 and $134,000 in 2018. Of this inventory, Seacraft retained and then sold $52,000 of the 2017 transfers in 2018 and held $66,000 of the 2018 transfers until 2019.Determine balances for the following items that would appear on consolidated financial statements for 2018:Cost of Goods SoldInventoryNet Income Attributable to Noncontrolling Interest. b. Assume that Seacraft sells inventory to Protrade at a markup equal to 60 percent of cost. Intra-entity transfers were $74,000 in 2017 and $104,000 in 2018. Of this inventory, $45,000 of the 2017 transfers were retained and then sold by Protrade in 2018, whereas $59,000 of the 2018 transfers were held until 2019.Determine balances for the following items that would appear on consolidated financial statements for 2018:Cost of Goods SoldInventoryNet Income Attributable to Noncontrolling Interestc. Protrade sells Seacraft a building on January 1, 2017, for $128,000,although its book value was only $74,000 on this date. The building had a five-year remaining life and was to be depreciated using the straight-line method with no salvage value.Determine balances for the following items that would appear on consolidated financial statements for 2018:Buildings (net)Operating ExpensesNet Income Attributable to Noncontrolling Interest
Protrade Corporation acquired 80 percent of the outstanding voting stock of Seacraft Company on January 1, 2017, for $612,000 in cash and other consideration. At the acquisition date, Protrade assessed Seacraft’s identifiable assets and liabilities at a collective net fair value of $765,000 and the fair value of the 20 percent noncontrolling interest was $153,000. No excess fair value over book value amortization accompanied the acquisition.
The following selected account balances are from the individual financial records of these two
companies as of December 31, 2018:
| Protrade | Seacraft | |
| Sales | $880000 | $600000 |
| Cost of goods sold | 410000 | 317000 |
| Operating expenses | 174000 | 129000 |
| 980000 | 420000 | |
| Inventory | 370000 | 144000 |
| Buildings (net) | 382000 | 181000 |
| Investment income | not given | -0- |
Each of the following problems is an independent situation:
a. Assume that Protrade sells Seacraft inventory at a markup equal to 60 percent of cost. Intra-entity transfers were $114,000 in 2017 and $134,000 in 2018. Of this inventory, Seacraft retained and then sold $52,000 of the 2017 transfers in 2018 and held $66,000 of the 2018 transfers until 2019.Determine balances for the following items that would appear on consolidated financial statements for 2018:
Cost of Goods Sold
Inventory
Net Income Attributable to Noncontrolling Interest. b. Assume that Seacraft sells inventory to Protrade at a markup equal to 60 percent of cost. Intra-entity transfers were $74,000 in 2017 and $104,000 in 2018. Of this inventory, $45,000 of the 2017 transfers were retained and then sold by Protrade in 2018, whereas $59,000 of the 2018 transfers were held until 2019.
Determine balances for the following items that would appear on consolidated financial statements for 2018:
Cost of Goods Sold
Inventory
Net Income Attributable to Noncontrolling Interest
c. Protrade sells Seacraft a building on January 1, 2017, for $128,000,although its book value was only $74,000 on this date. The building had a five-year remaining life and was to be
Determine balances for the following items that would appear on consolidated financial statements for 2018:
Buildings (net)
Operating Expenses
Net Income Attributable to Noncontrolling Interest
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