r The condensed financial statements for OIL Inc. and ERS Company for the year ended December 31,

r

Transcribed Image Text:

The condensed financial statements for OIL Inc. and ERS Company for the year ended December 31, Year 5, follow: ERS $324,000 212,000 264,000 $ 112,000 Revenues Expenses Net income Retained earnings, 1/1/Year 5 Net income Dividends paid Retained earnings, 12/31/Year 5 Cash Receivables and inventory Patented technology (net) Equipment (net) Total assets Liabilities. Common shares Retained earnings Total liabilities and equities OIL $ 936,000 672,000 $ 812,000 $ 212,000 264,000 112,000 102,000 $ 974,000 $ 324,000 $ $ 0 92,000 $ 412,000 122,000 182,000 912,000 318,000 712,000 612,000 $2,128,000 $1,234,000 $ 612,000 $ 428,000 542,000 974,000 $2,128,000 482,000 324,000 $1,234,000 On December 31, Year 5, after the above figures were prepared, OIL issued $252,000 in debt and 16,000 new shares to the owners of ERS for 80% of the outstanding shares of that company. OIL shares had a fair value of $32 per share. OIL also paid $42,000 to a broker for arranging the transaction. In addition, OIL paid $44,000 in stock issuance costs. ERS's equipment was actually worth $714,000, but its patented technology was appraised at only $292,000. Required: What are the consolidated balances for the year ended/at December 31, Year 5, for the following accounts? (a) Net income OIL's net income considered in the Consolidated Financial Statement (b) Retained earnings, 1/1/Year 5 OIL's retained earnings in the Financial statement for Consolidation (c) Equipment Value of equipment after acquisition (d) Patented technology Value of patent after acquisition (e) Goodwill Goodwill (f) Liabilities Total liabilities after acquisition (g) Common shares Total value of common shares after acquisition (h) Non-controlling interests Total value of non-controlling interest after acquisition $ The condensed financial statements for OIL Inc. and ERS Company for the year ended December 31, Year 5, follow: ERS $324,000 212,000 264,000 $ 112,000 Revenues Expenses Net income Retained earnings, 1/1/Year 5 Net income Dividends paid Retained earnings, 12/31/Year 5 Cash Receivables and inventory Patented technology (net) Equipment (net) Total assets Liabilities. Common shares Retained earnings Total liabilities and equities OIL $ 936,000 672,000 $ 812,000 $ 212,000 264,000 112,000 102,000 $ 974,000 $ 324,000 $ $ 0 92,000 $ 412,000 122,000 182,000 912,000 318,000 712,000 612,000 $2,128,000 $1,234,000 $ 612,000 $ 428,000 542,000 974,000 $2,128,000 482,000 324,000 $1,234,000 On December 31, Year 5, after the above figures were prepared, OIL issued $252,000 in debt and 16,000 new shares to the owners of ERS for 80% of the outstanding shares of that company. OIL shares had a fair value of $32 per share. OIL also paid $42,000 to a broker for arranging the transaction. In addition, OIL paid $44,000 in stock issuance costs. ERS's equipment was actually worth $714,000, but its patented technology was appraised at only $292,000. Required: What are the consolidated balances for the year ended/at December 31, Year 5, for the following accounts? (a) Net income OIL's net income considered in the Consolidated Financial Statement (b) Retained earnings, 1/1/Year 5 OIL's retained earnings in the Financial statement for Consolidation (c) Equipment Value of equipment after acquisition (d) Patented technology Value of patent after acquisition (e) Goodwill Goodwill (f) Liabilities Total liabilities after acquisition (g) Common shares Total value of common shares after acquisition (h) Non-controlling interests Total value of non-controlling interest after acquisition $