Please provide this question solution general accounting Puffin Industries acquired all of Sunset Coast Digital's stock on January 1, 2014, for$1,750,000 $1,050,000 in excess of book value. At that time, Sunset Coast's inventory(LIFO) was overvalued by $250,000 and its plant assets (10-year life) wereovervalued by $500,000. The remaining excess of cost over book value is attributedto undervalued identifiable intangible assets being amortized over 20 years. SunsetCoast depreciates plant assets and amortizes intangibles by the straight-linemethod. During the next three years, Sunset Coast reported a total net income of$425,000 and paid out 50 percent in dividends.Puffin carries its investment in Sunset Coast using the complete equity method.Sunset Coast's inventory increased each year since it was acquired by Puffin, andSunset Coast's reported net income for 2016 was $100,000.If Puffin reports $300,000 net income from its own operations in 2016, what is theconsolidated net income for 2016?

Step 1: Identify Puffin's net income from its own operations.Step 2: Identify Sunset Coast's…

Answered: Puffin Industries acquired all of…

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

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Chapter11: Long-term Assets

Section: Chapter Questions

Problem 11PB: On May 1, 2015, Zoe Inc. purchased Branta Corp. for $15,000,000 in cash. They only received...

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