in Huron Company during ticated equity, and cost. Exercise 2 (LO 1) Alternative investment models, more...

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in Huron Company during ticated equity, and cost. Exercise 2 (LO 1) Alternative investment models, more complex D&D. Mast Cor. poration acquires a 75% interest in the common stock of Shaw Company on for $462,500 cash. Shaw has the following balance sheet on that date: January 1, 2014, Liabilities and Equity Common stock ($5 par)... Paid-in capital in excess of par .... Assets Current assets $ 80,000 Current liabilities. Inventory 40,000 Land.... 100,000 Buildings and equipment (net).. 200,000 Retained earnings. Patent.. 30,000 Total assets.. $450,000 Total liabilities and equity $ 50,000 50,000 150,000 200,000 $450,000 Appraisals indicate that the book values for inventory, buildings and equipment, and patent buildings and equipment have an appraised fair value of $300,000 and a remaining life of 20 are below fair values. The inventory has a fair value of $50,000 and is sold during 2014. The e patent, which has a 10-year life, has an estimated fair value of $50,000. Any remain- years. The ing excess is goodwill. Shaw Company reports the following income earned and dividends paid during 2014 and 2015: Retained earnings, January 1, 2014... Net income, 2014.. Dividends paid in 2014. Balance, December 31, 2014 .... Net income, 2015...... Dividends paid in 2015. Balance, December 31, 2015 50,000 $200,000 $ 70,000 (20,000) $250,000 $ 48,000 (20,000) 28,000 $278,000 in Huron Company during ticated equity, and cost. Exercise 2 (LO 1) Alternative investment models, more complex D&D. Mast Cor. poration acquires a 75% interest in the common stock of Shaw Company on for $462,500 cash. Shaw has the following balance sheet on that date: January 1, 2014, Liabilities and Equity Common stock ($5 par)... Paid-in capital in excess of par .... Assets Current assets $ 80,000 Current liabilities. Inventory 40,000 Land.... 100,000 Buildings and equipment (net).. 200,000 Retained earnings. Patent.. 30,000 Total assets.. $450,000 Total liabilities and equity $ 50,000 50,000 150,000 200,000 $450,000 Appraisals indicate that the book values for inventory, buildings and equipment, and patent buildings and equipment have an appraised fair value of $300,000 and a remaining life of 20 are below fair values. The inventory has a fair value of $50,000 and is sold during 2014. The e patent, which has a 10-year life, has an estimated fair value of $50,000. Any remain- years. The ing excess is goodwill. Shaw Company reports the following income earned and dividends paid during 2014 and 2015: Retained earnings, January 1, 2014... Net income, 2014.. Dividends paid in 2014. Balance, December 31, 2014 .... Net income, 2015...... Dividends paid in 2015. Balance, December 31, 2015 50,000 $200,000 $ 70,000 (20,000) $250,000 $ 48,000 (20,000) 28,000 $278,000