Homework Help is Here – Start Your Trial Now!
Business
Accounting
The partial trial balances of P Co. and S Co. at December 31, Year 10, were as follows: Investment in S. Co. Common shares Retained earnings, beginning of year Additional Information P Co. Dr 198,000 162,000 137,000 Dr S Co. Cr. 156,000 68,500

The partial trial balances of P Co. and S Co. at December 31, Year 10, were as follows: Investment in S. Co. Common shares Retained earnings, beginning of year Additional Information P Co. Dr 198,000 162,000 137,000 Dr S Co. Cr. 156,000 68,500

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
See similar textbooks
icon
Related questions
Question

need correct answer with correct and complete working for all parts thanks answer in text

 

The partial trial balances of P Co. and S Co. at December 31, Year 10, were as follows: Investment in S. Co. Common shares Retained earnings, beginning of year P Co. S Co. $72,000 60,000 Dr 198,000 Balance, beginning of year Add: Net income Less: Dividends Retained earnings, Dec. 31 P Co. Cr. Additional Information The investment in the shares of S Co. (a 90% interest) was acquired January 2, Year 6, for $198,000. At that time, the shareholders' equity of S Co. was common shares of $156,000 and retained earnings of $32,000 and the common shares for P Co. of $162,000. • Net incomes of the two companies for the year were as follows: Common Shares $ 162000 162,000 137,000 0 0 $ 162000 Dr During Year 10, sales of P Co. to S Co. were $22,000, and sales of S Co. to P Co. were $62,000. Rates of gross profit on intercompany sales in Years 9 and 10 were 30% of sales. • On December 31, Year 9, the inventory of P Co. included $19,000 of merchandise purchased from S Co., and the inventory of S Co. included $15,000 of merchandise purchased from P Co. On December 31, Year 10, the inventory of P Co. Included $32,000 of merchandise purchased from S Co., and the inventory of S Co. included $17,000 of merchandise purchased from P Co. • During the year ended December 31, Year 10, P Co. paid dividends of $24,000 and S Co. paid dividends of $22,000. At the time that P Co. purchased the shares of S Co., the acquisition differential was allocated to patents of S Co. These patents are being amortized for consolidation purposes over a period of five years. In Year 8, land that originally cost $52,000 was sold by S Co. to P Co. for $63,200. The land is still owned by P Co. Assume a corporate tax rate of 40%. Required: Prepare a consolidated statement of changes in equity for the year ended December 31, Year 10. (Leave no cells blank - be certain to enter "0" wherever required. Negative amounts should be indicated by a minus sign. Omit $ sign in your response.) S Co. P Co. Consolidated Statement of Changes in Equity For Year Ended December 31, Year 10 Cr. $ 156,000 68,500 Retained Earnings $ 24000 $ Total 24000 Non-controlling Interest $ Total $ $
Transcribed Image Text:The partial trial balances of P Co. and S Co. at December 31, Year 10, were as follows: Investment in S. Co. Common shares Retained earnings, beginning of year P Co. S Co. $72,000 60,000 Dr 198,000 Balance, beginning of year Add: Net income Less: Dividends Retained earnings, Dec. 31 P Co. Cr. Additional Information The investment in the shares of S Co. (a 90% interest) was acquired January 2, Year 6, for $198,000. At that time, the shareholders' equity of S Co. was common shares of $156,000 and retained earnings of $32,000 and the common shares for P Co. of $162,000. • Net incomes of the two companies for the year were as follows: Common Shares $ 162000 162,000 137,000 0 0 $ 162000 Dr During Year 10, sales of P Co. to S Co. were $22,000, and sales of S Co. to P Co. were $62,000. Rates of gross profit on intercompany sales in Years 9 and 10 were 30% of sales. • On December 31, Year 9, the inventory of P Co. included $19,000 of merchandise purchased from S Co., and the inventory of S Co. included $15,000 of merchandise purchased from P Co. On December 31, Year 10, the inventory of P Co. Included $32,000 of merchandise purchased from S Co., and the inventory of S Co. included $17,000 of merchandise purchased from P Co. • During the year ended December 31, Year 10, P Co. paid dividends of $24,000 and S Co. paid dividends of $22,000. At the time that P Co. purchased the shares of S Co., the acquisition differential was allocated to patents of S Co. These patents are being amortized for consolidation purposes over a period of five years. In Year 8, land that originally cost $52,000 was sold by S Co. to P Co. for $63,200. The land is still owned by P Co. Assume a corporate tax rate of 40%. Required: Prepare a consolidated statement of changes in equity for the year ended December 31, Year 10. (Leave no cells blank - be certain to enter "0" wherever required. Negative amounts should be indicated by a minus sign. Omit $ sign in your response.) S Co. P Co. Consolidated Statement of Changes in Equity For Year Ended December 31, Year 10 Cr. $ 156,000 68,500 Retained Earnings $ 24000 $ Total 24000 Non-controlling Interest $ Total $ $
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 8 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Investments and Financial instruments
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education
SEE MORE TEXTBOOKS