Monarch Corporation paid $180,000 for a 75% interest in Stem Co.’s outstanding Capital Stock on January 1, 2005, when Stem’s stockholders’ equity consisted of $150,000 of Capital Stock and $50,000 of Retained Earnings. Book values of Stem’s net assets were equal to their fair values on this date. The adjusted trial balances of Monarch and Stem on December 31, 2005 were as follows:

		Packer		Stem
Cash	$	8,250	$	35,000
Dividends receivable		7,500
Other current assets		40,000		50,000
Land		50,000		30,000
Plant assets-net		100,000		150,000
Investment in Stem		195,000
Cost of sales		225,000		125,000
Other expenses		45,000		25,000
Dividends		25,000		20,000
	$	695,750	$	435,000
Accounts payable	$	40,750	$	35,000
Dividends payable				10,000
Capital stock		150,000		150,000
Retained earnings		75,000		50,000
Sales revenue		400,000		190,000
Income from Stem		30,000
	$	695,750	$	435,000

Required:

Complete the partially prepared consolidated balance sheet working papers that appear below.

Answer rating: 100% (QA)

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