The Pop Company paid $ 1,680,000 in a 30% interest in Voting Shares Son Corporation

 On January 1, 2016. The book value and fair value of the son's assets and liabilities on January 1, together with

With consumption data, they are as follows (in thousands):

Fair value book

Cash 400 $ 400 $ 400

Accounts receivable - net 700 700

Stock (sold in 2016) 1,000 1,200

Other current assets 200 200

Land 900 1,700

Buildings - net (10 years remaining) 1,500 2,000

 

Equipment - net (7 years remaining life) 1,200,500

Total assets $ 5,900 $ 6,700

Accounts payable $ 800 800

Other current liabilities 200,000

Bonds Payable (Maturing 1 January 2021) 1,000 1,100

Equity shares, $ 10 par, $ 3,000

Retained earnings 900

Total equity is $ 5,900

Sun Corporation reported net income of $ 1,200,000 for 2016 and dividends paid of $ 600,000.

wanted

1. Set up a schedule for allocating investment fair values / book value differences related to Pop's investment

In the Son.

2. Calculate Son's Pop Income for 2016.

3. Identify Pop's investment balance in the Son account on December 31, 2016.

Answer rating: 100% (QA)

Schedule showing Fair consideration on acquisition of 30 rights in Son of the Corporation on Jan1 20... View the full answer