Company A acquires 90% of the common stock of Company B on December 31, 2019, by...

  

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Company A acquires 90% of the common stock of Company B on December 31, 2019, by paying $320,000 cash to the shareholders of Company B. The two firm's pre-acquisition balance sheets as of December 31, 2019 and pre-acquisition pro forma income statements for the year ending December 31, 2020 are presented below: (6 points) Pre-Acquisition Balance Sheet December 31, 2019 Company A Company B Current Assets $850,000 $275,000 Other Assets 550,000 145,000 $420,000 Total Assets $1.400,000 Current Liabilities $700,000 $245,000 Common Stock 450,000 100,000 Retained Earnings Total Liabilities & Equity 250,000 $1,400,000 75,000 $420,000 Unconsolidated Income Statement December 31, 2020 Company A Company B Revenue $1,200,000 $550,000 Expenses 750,000 440,000 Net Income $450,000 $110,000 Dividends $25,000 As of the date of the transaction, total assets reported by Company A is: A. $1,080,000 B. $1,440,000 C. $1,500,000 For the year ended December 31, 2020, Company A's pro forma consolidated net income is: A. $495,000 B. $549,000 C. $576,000 As of December 31, 2020, Company A should report a minority ownership interest of: A. $0 B. $33,000 C. $26,000 Company A acquires 90% of the common stock of Company B on December 31, 2019, by paying $320,000 cash to the shareholders of Company B. The two firm's pre-acquisition balance sheets as of December 31, 2019 and pre-acquisition pro forma income statements for the year ending December 31, 2020 are presented below: (6 points) Pre-Acquisition Balance Sheet December 31, 2019 Company A Company B Current Assets $850,000 $275,000 Other Assets 550,000 145,000 $420,000 Total Assets $1.400,000 Current Liabilities $700,000 $245,000 Common Stock 450,000 100,000 Retained Earnings Total Liabilities & Equity 250,000 $1,400,000 75,000 $420,000 Unconsolidated Income Statement December 31, 2020 Company A Company B Revenue $1,200,000 $550,000 Expenses 750,000 440,000 Net Income $450,000 $110,000 Dividends $25,000 As of the date of the transaction, total assets reported by Company A is: A. $1,080,000 B. $1,440,000 C. $1,500,000 For the year ended December 31, 2020, Company A's pro forma consolidated net income is: A. $495,000 B. $549,000 C. $576,000 As of December 31, 2020, Company A should report a minority ownership interest of: A. $0 B. $33,000 C. $26,000 Company A acquires 90% of the common stock of Company B on December 31, 2019, by paying $320,000 cash to the shareholders of Company B. The two firm's pre-acquisition balance sheets as of December 31, 2019 and pre-acquisition pro forma income statements for the year ending December 31, 2020 are presented below: (6 points) Pre-Acquisition Balance Sheet December 31, 2019 Company A Company B Current Assets $850,000 $275,000 Other Assets 550,000 145,000 $420,000 Total Assets $1.400,000 Current Liabilities $700,000 $245,000 Common Stock 450,000 100,000 Retained Earnings Total Liabilities & Equity 250,000 $1,400,000 75,000 $420,000 Unconsolidated Income Statement December 31, 2020 Company A Company B Revenue $1,200,000 $550,000 Expenses 750,000 440,000 Net Income $450,000 $110,000 Dividends $25,000 As of the date of the transaction, total assets reported by Company A is: A. $1,080,000 B. $1,440,000 C. $1,500,000 For the year ended December 31, 2020, Company A's pro forma consolidated net income is: A. $495,000 B. $549,000 C. $576,000 As of December 31, 2020, Company A should report a minority ownership interest of: A. $0 B. $33,000 C. $26,000 Company A acquires 90% of the common stock of Company B on December 31, 2019, by paying $320,000 cash to the shareholders of Company B. The two firm's pre-acquisition balance sheets as of December 31, 2019 and pre-acquisition pro forma income statements for the year ending December 31, 2020 are presented below: (6 points) Pre-Acquisition Balance Sheet December 31, 2019 Company A Company B Current Assets $850,000 $275,000 Other Assets 550,000 145,000 $420,000 Total Assets $1.400,000 Current Liabilities $700,000 $245,000 Common Stock 450,000 100,000 Retained Earnings Total Liabilities & Equity 250,000 $1,400,000 75,000 $420,000 Unconsolidated Income Statement December 31, 2020 Company A Company B Revenue $1,200,000 $550,000 Expenses 750,000 440,000 Net Income $450,000 $110,000 Dividends $25,000 As of the date of the transaction, total assets reported by Company A is: A. $1,080,000 B. $1,440,000 C. $1,500,000 For the year ended December 31, 2020, Company A's pro forma consolidated net income is: A. $495,000 B. $549,000 C. $576,000 As of December 31, 2020, Company A should report a minority ownership interest of: A. $0 B. $33,000 C. $26,000