Problem 1 Parent acquired 35,000 shares of Sub stock on January 1, 2017 at a price...

 

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Problem 1 Parent acquired 35,000 shares of Sub stock on January 1, 2017 at a price of $34 per share. At the date of acquisition Sub had the following Stockholders Equity Common Stock ($10 par) Paid in Capital Retained Earnings At the date of acquisition, the sub had the following differences between book and fair values. Inventory Patents Equipment, net The Sub $ 500,000 200,000 680,000 Book Value 413,000 240,000 618,000 Fair Value 503,000 (Sold in 2017) 210,000 (7 Yr Rem Life) 722,000 (5 Yr Remaining Life) pays the Parent an annual management fee of $40,000. REQUIRED: Complete the attached consolidation workpapers for the year ended December 31, 2020. Problem 1 Parent acquired 35,000 shares of Sub stock on January 1, 2017 at a price of $34 per share. At the date of acquisition Sub had the following Stockholders Equity Common Stock ($10 par) Paid in Capital Retained Earnings At the date of acquisition, the sub had the following differences between book and fair values. Inventory Patents Equipment, net The Sub $ 500,000 200,000 680,000 Book Value 413,000 240,000 618,000 Fair Value 503,000 (Sold in 2017) 210,000 (7 Yr Rem Life) 722,000 (5 Yr Remaining Life) pays the Parent an annual management fee of $40,000. REQUIRED: Complete the attached consolidation workpapers for the year ended December 31, 2020.

Answer rating: 100% (QA)

Consolidation Workpapers for the Year Ended December 31 2020 Parent Subsidiary S... View the full answer