Panther Company acquires an 80% interest in Sargo Company for $272,000 in cash on January 1, 2011, when Sargo Company has the following balance sheet:
The excess of the price paid over book value is attributable to the fixed assets, which have a fair value of $260,000, and to goodwill. The fixed assets have a 10-year remaining life. Panther Company uses the simple equity method to record its investment in Sargo Company.
The following trial balances of the two companies are prepared on December 31, 2011:
1. Prepare a determination and distribution of excess schedule (a value analysis is not needed) for the investment.
2. Prepare all the eliminations and adjustments that would be made on the 2011 consolidated worksheet.
3. Prepare the 2011 consolidated income statement and its related income distribution schedules.
4. Prepare the 2011 statement of retained earnings.
5. Prepare the 2011 consolidated balance sheet.

  • CreatedApril 13, 2015
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