The following are selected account balances from Penske Company and Stanza Corporation as of December 31, 2021: Penske $(742,000) 264,700 187,000 Revenues Cost of goods sold Depreciation expense Investment income Dividends declared Retained earnings, 1/1/21 Current assets Copyrights Royalty agreements Investment in Stanza Liabilities Not given 80,000 (788,000) 498,000 990,000 772,000 Consolidated copyrights b. Consolidated net income C. Consolidated retained earnings d. Consolidated goodwill Not given (600,000) (600,000) ($20 par) (150,000) Common stock Additional paid-in capital Note: Parentheses indicate a credit balance. Stanza $ (652,000) 163,000 224,000 0 60,000 (330,000) 598,000 384,000 1,190,000 Amounts 0 (1,357,000) On January 1, 2021, Penske acquired all of Stanza's outstanding stock for $829,000 fair value in cash and common stock. Penske also paid $10,000 in stock issuance costs. At the date of acquisition, copyrights (with a six-year remaining life) have a $456,000 book value but a fair value of $660,000. (200,000) ($10 par) (80,000) a. As of December 31, 2021, what is the consolidated copyrights balance? b. For the year ending December 31, 2021, what is consolidated net income? c. As of December 31, 2021, what is the consolidated retained earnings balance? d. As of December 31, 2021, what is the consolidated balance to be reported for goodwill?
The following are selected account balances from Penske Company and Stanza Corporation as of December 31, 2021: Penske $(742,000) 264,700 187,000 Revenues Cost of goods sold Depreciation expense Investment income Dividends declared Retained earnings, 1/1/21 Current assets Copyrights Royalty agreements Investment in Stanza Liabilities Not given 80,000 (788,000) 498,000 990,000 772,000 Consolidated copyrights b. Consolidated net income C. Consolidated retained earnings d. Consolidated goodwill Not given (600,000) (600,000) ($20 par) (150,000) Common stock Additional paid-in capital Note: Parentheses indicate a credit balance. Stanza $ (652,000) 163,000 224,000 0 60,000 (330,000) 598,000 384,000 1,190,000 Amounts 0 (1,357,000) On January 1, 2021, Penske acquired all of Stanza's outstanding stock for $829,000 fair value in cash and common stock. Penske also paid $10,000 in stock issuance costs. At the date of acquisition, copyrights (with a six-year remaining life) have a $456,000 book value but a fair value of $660,000. (200,000) ($10 par) (80,000) a. As of December 31, 2021, what is the consolidated copyrights balance? b. For the year ending December 31, 2021, what is consolidated net income? c. As of December 31, 2021, what is the consolidated retained earnings balance? d. As of December 31, 2021, what is the consolidated balance to be reported for goodwill?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:The following are selected account balances from Penske Company and Stanza Corporation as of December 31, 2021:
Revenues
Cost of goods sold
Depreciation expense
Investment income.
Dividends declared
Retained earnings, 1/1/21
Current assets
Copyrights
Royalty agreements
Investment in Stanza
Liabilities
Common stock
Additional paid-in capital
Penske
$ (742,000)
264,700
187,000
Not given
80,000
(788,000)
498,000
990,000
772,000
a.
Consolidated copyrights
b. Consolidated net income
C. Consolidated retained earnings
d.
Consolidated goodwill
Not given
(600,000)
(600,000) ($20 par)
(150,000)
Note: Parentheses indicate a credit balance.
Stanza
$ (652,000)
163,000
224,000
0
Amounts
60,000
(330,000)
598,000
384,000
1,190,000
0
(1,357,000)
On January 1, 2021, Penske acquired all of Stanza's outstanding stock for $829,000 fair value in cash and common stock. Penske also
paid $10,000 in stock issuance costs. At the date of acquisition, copyrights (with a six-year remaining life) have a $456,000 book value
but a fair value of $660,000.
(200,000) ($10 par)
(80,000)
a. As of December 31, 2021, what is the consolidated copyrights balance?
b. For the year ending December 31, 2021, what is consolidated net income?
c. As of December 31, 2021, what is the consolidated retained earnings balance?
d. As of December 31, 2021, what is the consolidated balance to be reported for goodwill?
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