Placid Lake Corporation acquired 8 0 percent of the outstanding voting stock of Scenic, Incorporated, on January
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Question:
Placid Lake Corporation acquired percent of the outstanding voting stock of Scenic, Incorporated, on January when Scenic had a net book value of $ Any excess fair value was assigned to intangible assets and amortized at a rate of $ per year.
Placid Lake's net income before consideration of its relationship with Scenic and before adjustments for intraentity sales was $ Scenic reported net income of $ Placid Lake declared $ in dividends during this period; Scenic paid $ At the end of selected figures from the two companies' balance sheets were as follows:
Items Placid Lake Scenic
Inventory $ $
Land
Equipment net
During intraentity sales of $original cost of $ were made. Only percent of this inventory was still held within the consolidated entity at the end of In $ in intraentity sales were made with an original cost of $ Of this merchandise, percent had not been resold to outside parties by the end of the year.
Each of the following questions should be considered as an independent situation for the year
Required:
What is consolidated net income for Placid Lake and its subsidiary?
Related Book For
Advanced Accounting
ISBN: 978-1259444951
13th edition
Authors: Joe Ben Hoyle, Thomas Schaefer, Timothy Doupni
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