On June 30, 2018, Plaster, Inc., paid $916,000 for 80 percent of Stucco Company's outstanding stock. Plaster
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Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 60,000
Accounts receivable . . . . . . . . . . . . . . . . . . 127,000
Inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . 203,000
Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65,000
Buildings . . . . . . . . . . . . . . . . . . . . . . . . . . . . 175,000
Equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . 300,000
Accounts payable . . . . . . . . . . . . . . . . . . . . (35,000)
On June 30, Plaster allocated the excess acquisition-date fair value over book value to Stucco's assets as follows:
Equipment (3-year remaining life) . . . . . . . . . . $ 75,000
Database (10-year remaining life) . . . . . . . . . . 175,000
At the end of 2018, the following comparative (2017 and 2018) balance sheets and consolidated income statement were available:
Additional Information for 2018
On December 1, Stucco paid a $40,000 dividend. During the year, Plaster paid $100,000 in dividends.
During the year, Plaster issued $800,000 in long-term debt at par.
Plaster reported no asset purchases or dispositions other than the acquisition of Stucco.
Prepare a 2018 consolidated statement of cash flows for Plaster and Stucco. Use the indirect method of reporting cash flows from operating activities.
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Related Book For
Advanced Accounting
ISBN: 978-1259444951
13th edition
Authors: Joe Ben Hoyle, Thomas Schaefer, Timothy Doupni
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