Advanced Accounting
14th Edition
ISBN: 9781260247824
Author: Joe Ben Hoyle, Thomas F. Schaefer, Timothy S. Doupnik
Publisher: RENT MCG
expand_more
expand_more
format_list_bulleted
Question
Chapter 4, Problem 16P
To determine
Introduction: Consolidated financial statements are the single set of statements that combines two or more companies to create a single economic entity. A consolidated
The number of trademarks reported in the 2021 consolidated balance sheet.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
On January 1, 2023, French Company acquired 60 percent of K-Tech Company for $342,000 when K-Tech's book value was
$442,000. The fair value of the newly comprised 40 percent noncontrolling interest was assessed at $228,000. At the acquisition
date, K-Tech's trademark (10-year remaining life) was undervalued in its financial records by $80,000. Also, patented technology (5-
year remaining life) was undervalued by $48,000.
In 2023, K-Tech reports $8,000 net income and declares no dividends. At the end of 2024, the two companies report the following
figures (stockholders' equity accounts have been omitted):
Items
Current assets
Trademarks
Patented technology
Liabilities
French Company
Carrying Amounts
$ 644,000
284,000
434,000
(414,000)
K-Tech Company
Carrying
Amounts
$ 324,000
224,000
174,000
K-Tech Company
Fair Values
$ 344,000
304,000
222,000
(144,000)
Revenues
Expenses
Investment income
(144,000)
(924,000)
(424,000)
476,000
324,000
Not given
0
Note: Parentheses indicate a credit…
On January 1, 2020, French Company acquired 60 percent of K-Tech Company for $300,000 when K-Tech's
book value was $400,000. The fair value of the newly comprised 40 percent noncontrolling interest was
assessed at $200,000. At the acquisition date, K-Tech's trademark (10-year remaining life) was undervalued
in its financial records by $60,000. Also, patented technology (5-year remaining life) was undervalued by
$40,000.
In 2020, K-Tech reports $30,000 net income and declares no dividends. At the end of 2021, the two
companies report the following figures (stockholders' equity accounts have been omitted):
К-Теch
Company
Fair
Values
French
Company
Carrying
Amounts
К-Тech
Company
Carrying
Amounts
Current
$ 620,000 $ 300,000
$ 320,000
assets
Trademarks
Patented
260,000
200,000
280,000
410,000
150,000
190,000
technology
Liabilities
Revenues
Expenses
Investment
income
(390,000)
(900,000)
500,000
(120,000)
(400,000)
300,000
(120,000)
Not given
Note: Parentheses indicate a credit balance.
Vhat…
On January 1, 2020, French Company acquired 60 percent of K-Tech Company for $306,000 when K-Tech’s book value was $406,000. The fair value of the newly comprised 40 percent noncontrolling interest was assessed at $204,000. At the acquisition date, K-Tech's trademark (10-year remaining life) was undervalued in its financial records by $80,000. Also, patented technology (5-year remaining life) was undervalued by $24,000.
In 2020, K-Tech reports $28,000 net income and declares no dividends. At the end of 2021, the two companies report the following figures (stockholders’ equity accounts have been omitted):
French CompanyCarrying Amounts
K-Tech CompanyCarrying Amounts
K-Tech CompanyFair Values
Current assets
$
624,000
$
304,000
$
324,000
Trademarks
264,000
204,000
284,000
Patented technology
414,000
154,000
178,000
Liabilities
(394,000
)
(124,000
)
(124,000
)
Revenues
(904,000
)
(404,000
)…
Chapter 4 Solutions
Advanced Accounting
Knowledge Booster
Similar questions
- On January 1, 2023, French Company acquired 60 percent of K-Tech Company for $300,000 when K-Tech’s book value was $400,000. The fair value of the newly comprised 40 percent noncontrolling interest was assessed at $200,000. At the acquisition date, K-Tech's trademark (10-year remaining life) was undervalued in its financial records by $60,000. Also, patented technology (5-year remaining life) was undervalued by $40,000. In 2023, K-Tech reports $30,000 net income and declares no dividends. At the end of 2024, the two companies report the following figures (stockholders’ equity accounts have been omitted): Items French Company Carrying Amounts K-Tech Company Carrying Amounts K-Tech Company Fair Values Current assets $ 620,000 $ 300,000 $ 320,000 Trademarks 260,000 200,000 280,000 Patented technology 410,000 150,000 190,000 Liabilities (390,000) (120,000) (120,000) Revenues (900,000) (400,000) 0 Expenses 500,000 300,000 0 Investment income Not given 0 0 Note:…arrow_forwardWhat amount is reported for trademarks in the 2021 consolidated balance sheet? Multiple Choice O $576,000. $568,000. $560,000. $552,000.arrow_forwardOn January 1, 2023, French Company acquired 60 percent of K-Tech Company for $319,500 when K-Tech's book value was $419,500. The fair value of the newly comprised 40 percent noncontrolling interest was assessed at $213,000. At the acquisition date, K-Tech's trademark (10-year remaining life) was undervalued in its financial records by $80,000. Also, patented technology (5-year remaining life) was undervalued by $33,000. In 2023, K-Tech reports $19,500 net income and declares no dividends. At the end of 2024, the two companies report the following figures (stockholders' equity accounts have been omitted): Items Current assets Trademarks Patented technology Liabilities Revenues French Company Carrying Amounts $ 631,000 271,000 421,000 (401,000) K-Tech Company Carrying Amounts $ 311,000 211,000 161,000 K-Tech Company Fair Values $ 331,000 291,000 194,000 (131,000) 0 (131,000) (911,000) (411,000) Expenses 489,000 311,000 Investment income Not given 0 Note: Parentheses indicate a credit…arrow_forward
- On January 1, 2023, French Company acquired 60 percent of K-Tech Company for $306,000 when K-Tech's book value was $406,000. The fair value of the newly comprised 40 percent noncontrolling interest was assessed at $204,000. At the acquisition date, K-Tech's trademark (10-year remaining life) was undervalued in its financial records by $80,000. Also, patented technology (5- year remaining life) was undervalued by $24,000. In 2023, K-Tech reports $28,000 net income and declares no dividends. At the end of 2024, the two companies report the following figures (stockholders' equity accounts have been omitted): Itens Current assets Trademarks Patented technology Liabilities Revenues Expenses Investment income French Company Carrying Amounts $ 624,000 264,000 414,000 (394,000) (904,000) 496,000 Not given K-Tech Company Carrying Amounts $ 304,000 204,000 154,000 (124,000) (404,000) 304,000 K-Tech Company Fair Values $ 324,000 284,000 178,000 (124,000) Note: Parentheses indicate a credit…arrow_forwardsarrow_forwardRequired information [The following information applies to the questions displayed below.] On January 1, 2020, French Company acquired 60 percent of K-Tech Company for $306,000 when K-Tech's book value was $406,000. The fair value of the newly comprised 40 percent noncontrolling interest was assessed at $204,000. At the acquisition date, K-Tech's trademark (10-year remaining life) was undervalued in its financial records by $80,000. Also, patented technology (5-year remaining life) was undervalued by $24,000. In 2020, K-Tech reports $24,000 net income and declares no dividends. At the end of 2021, the two companies report the following figures (stockholders' equity accounts have been omitted): French Company K-Tech Company Carrying Carrying K-Tech Company Amounts Amounts Fair Values 622,000 262,000 412,000 (392,000) (902,000) 498,000 Not given $ 302,000 202,000 152,000 (122,000) (402,000) 302,000 $ 322,000 282,000 176,000 (122,000) Current assets Trademarks Patented technology…arrow_forward
- Required information [The following information applies to the questions displayed below.] On January 1, 2020, French Company acquired 60 percent of K-Tech Company for $306,000 when K-Tech's book value was $406,000. The fair value of the newly comprised 40 percent noncontrolling interest was assessed at $204,000. At the acquisition date, K-Tech's trademark (10-year remaining life) was undervalued in its financial records by $80,000. Also, patented technology (5-year remaining life) was undervalued by $24,000. In 2020, K-Tech reports $24,000 net income and declares no dividends. At the end of 2021, the two companies report the following figures (stockholders' equity accounts have been omitted): French Company K-Tech Company Carrying Carrying K-Tech Company Amounts Amounts Fair Values 622,000 262,000 412,000 (392,000) (902,000) 302,000 202,000 152,000 (122,000) (402,000) 302,000 322,000 282,000 176,000 (122,000) Current assets Trademarks Patented technology Liabilities Revenues Expenses…arrow_forwardUse the following information for Problems 14 through 16:West Company acquired 60 percent of Solar Company for $300,000 when Solar’s book value was $400,000. The newly comprised 40 percent noncontrolling interest had an assessed fair value of $200,000. Also at the acquisition date, Solar had a trademark (with a 10-year remaining life) that was undervalued in the financial records by $60,000. Also, patented technology (with a 5-year remaining life) was undervalued by $40,000. Two years later, the following figures are reported by these two companies (stockholders’ equity accounts have been omitted):What is the consolidated net income before allocation to the controlling and noncontrolling interests?a. $400,000b. $486,000c. $491,600d. $500,000arrow_forwardUse the following information for Problems 14 through 16:West Company acquired 60 percent of Solar Company for $300,000 when Solar’s book value was $400,000. The newly comprised 40 percent noncontrolling interest had an assessed fair value of $200,000. Also at the acquisition date, Solar had a trademark (with a 10-year remaining life) that was undervalued in the financial records by $60,000. Also, patented technology (with a 5-year remaining life) was undervalued by $40,000. Two years later, the following figures are reported by these two companies (stockholders’ equity accounts have been omitted):What is the consolidated trademarks balance?a. $508,000b. $514,000c. $520,000d. $540,000arrow_forward
- Use the following information for Problems 14 through 16:West Company acquired 60 percent of Solar Company for $300,000 when Solar’s book value was $400,000. The newly comprised 40 percent noncontrolling interest had an assessed fair value of $200,000. Also at the acquisition date, Solar had a trademark (with a 10-year remaining life) that was undervalued in the financial records by $60,000. Also, patented technology (with a 5-year remaining life) was undervalued by $40,000. Two years later, the following figures are reported by these two companies (stockholders’ equity accounts have been omitted):Assuming Solar Company has declared no dividends, what are the noncontrolling interest’s share of the subsidiary’s income and the ending balance of the noncontrolling interest in the subsidiary?a. $26,000 and $230,000b. $28,800 and $252,000c. $34,400 and $240,800d. $40,000 and $252,000arrow_forwardOn January 1, 2025, John Paul Jones Corp. purchased 30% of Sky Tech Inc. for $45 million. This acquisition gave John Paul Jones significant influence over Sky Tech. At the date of acquisition, the book value of Sky Tech's net assets was $75 million and their fair value was $90 million. The difference was attributed to the fair value of equipment exceeding book value, and the remaining useful life of this equipment was 5 years. For 2025, Sky Tech reported a net income of $75 million and declared and paid $20 million in dividends. Relative to its investment in Sky Tech, the amount of investment income reported by John Paul Jones Corp. on it’s year end December 31, 2025 income statement is: $6 million. $16.5 million. $22.5 million. $21.6 million. The total amount that John Paul Jones Corp. would report for its investment in Sky Tech Inc. on itsDecember 31, 2025 balance sheet is: $67.5 million. $61.5 million. $60.6 million. $66.6 million. Assume John Paul cannot exercise significant…arrow_forwardOn January 2, 2020, Kent Corp. paid 1,600,000 for the purchase of 40% of the ordinary shares of Kara Company. The statement of financial position of Kara at the date of acquisition shows the following information:Assets subject to depreciation (remaining useful life is 8 years) 2,400,000Assets not subject to depreciation 800,000Liabilties 400,000Both book value and fair value are the same for assets not subject to depreciation and liabilities. The fair market value of Karas assets subject to depreciation is 2,720,000. Kara depreciates its assets using the straight-line method. Karas intangibles are amortized over a 20-year period. Net income for the year ended December 31, 2020, is 640,000. It declares and pays dividends of 500,000 in 2020.What amount of the investment cost is attributable to goodwill? a. 480,000 b. 352,000 c. 608,000 d. 128,000arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Intermediate Accounting: Reporting And AnalysisAccountingISBN:9781337788281Author:James M. Wahlen, Jefferson P. Jones, Donald PagachPublisher:Cengage Learning
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:Cengage Learning