Question

A consolidated income statement for 2011 and comparative consolidated balance sheets for 2010 and 2011 for P Company and its 80% owned subsidiary follow:
P COMPANY AND SUBSIDIARY
Consolidated Income Statement
for the Year Ended December 31, 2011
Sales............... $1,900,000
Cost of goods sold......... 1,000,000
Gross margin........... 900,000
Expenses............ 300,000
Operating income before tax..... 600,000
Dividend income.......... 50,000
Income before tax........ 550,000
Income taxes.......... 220,000
Consolidated net income........... 330,000
Less: Noncontrolling interest in consolidated net income. 66,000
Controlling interest in consolidated net income...... $ 264,000



Other information:
1. Equipment depreciation was $95,000.
2. Equipment was purchased during the year for cash, $545,000.
3. Dividends paid during 2011:
a. Declared and paid by S Company, $40,000.
b. Declared and paid by P Company, $60,000.
4. The bonds payable were issued on December 30, 2011, for $240,000.
5. Common stock issued during 2011, 150,000 shares.

Required:
Prepare a consolidated statement of cash flows for the year ended December 31, 2011, using the indirectmethod.


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  • CreatedMarch 13, 2015
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