Marion Company is an 80% owned subsidiary of Lange Company. The interest in Marion is purchased on
Question:
The following comparative consolidated trial balances apply to Lange Company and its subsidiary, Marion:
The 2016 information shown on page 362 is available for the Lange andMarion companies.
a. Marion purchases equipment for $70,000.
b. Marion issues $350,000 of long-term bonds and later uses the proceeds to purchase a new building.
c. On January 1, 2016, Lange purchases 30% of the outstanding common stock of Charles Corporation for $230,000. This is an influential investment. Charles's stockholders' equity is $700,000 on the date of the purchase. Any excess cost is attributed to equipment with a 10-year life. Charles reports net income of $80,000 in 2016 and pays dividends of $25,000.
d. Controlling share of consolidated income for 2016 is $262,000; the noncontrolling interest in consolidated net income is $15,000. Lange pays $100,000 in dividends in 2016; Marion pays $15,000 in dividends in 2016.
Required
Prepare the consolidated statement of cash flows for 2016 using the indirect method. Any supporting calculations (including a determination and distribution of excess schedule) should be in good form.
The word "distribution" has several meanings in the financial world, most of them pertaining to the payment of assets from a fund, account, or individual security to an investor or beneficiary. Retirement account distributions are among the most...
Step by Step Answer:
Advanced Accounting
ISBN: 978-1305084858
12th edition
Authors: Paul M. Fischer, William J. Tayler, Rita H. Cheng