Question: Following are several figures reported for Preston and Sanchez as

Following are several figures reported for Preston and Sanchez as of December 31, 2011:

.:.
Preston acquired 70 percent of Sanchez in January 2010. In allocating the newly acquired subsidiary’s fair value at the acquisition date, Preston noted that Sanchez having developed a customer list worth $65,000 unrecorded on its accounting records and having a five-year remaining life. Any remaining excess fair value over Sanchez’s book value was attributed to goodwill. During 2011, Sanchez sells inventory costing $120,000 to Preston for $160,000. Of this amount, 20 percent remains unsold in Preston’s warehouse at year-end. For Preston’s consolidated reports, determine the following amounts to be reported for the current year.
Inventory
Sales
Cost of Goods Sold
Operating Expenses
Noncontrolling Interest in the Subsidiary’s Net Income


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  • CreatedOctober 04, 2014
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