On February 20, 2012, Angel AG acquired all common stock of Mark AG. The book value...
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On February 20, 2012, Angel AG acquired all common stock of Mark AG. The book value of Mark AG's net assets was equal to the fair value at the acquisition date. Mark AG regularly sold inventories to Angel AG with 10 percent mark up. In 2014, $200,000 of Angel AG's beginning inventory was purchased from Mark AG. The trial balances of both companies for the year ended 2014 are as follows (in thousands): Debits Cash Accounts receivable Inventory Plant Asset Investment in Mark AG Cost of sales Other expenses Dividends Total Credits Accounts payable Common stock Retained Earnings Sales Total Angel AG $ 400 $ 300 $ 400 $4,900 $ 4,000 $4,500 $ 800 $ 300 $ 15,600 $ 1,200 $ 3,000 $ 4,400 $ 7,000 $15,600 Mark AG $ 100 $.200 $ 500 $3,600 $ 3,000 $ 1,000 $ 200 $ 8,600 $ 200 $ 2,000 $1,400 $ 5,000 $ 8,600 Angel AG's ending inventory 25 percent are purchased from Mark AG and $1,100 of Mark AG's sales are sales to Angel AG. Required: Prepare a consolidation workpapers for Angel AG and subsidiary for the year ended December 31, 2014. On February 20, 2012, Angel AG acquired all common stock of Mark AG. The book value of Mark AG's net assets was equal to the fair value at the acquisition date. Mark AG regularly sold inventories to Angel AG with 10 percent mark up. In 2014, $200,000 of Angel AG's beginning inventory was purchased from Mark AG. The trial balances of both companies for the year ended 2014 are as follows (in thousands): Debits Cash Accounts receivable Inventory Plant Asset Investment in Mark AG Cost of sales Other expenses Dividends Total Credits Accounts payable Common stock Retained Earnings Sales Total Angel AG $ 400 $ 300 $ 400 $4,900 $ 4,000 $4,500 $ 800 $ 300 $ 15,600 $ 1,200 $ 3,000 $ 4,400 $ 7,000 $15,600 Mark AG $ 100 $.200 $ 500 $3,600 $ 3,000 $ 1,000 $ 200 $ 8,600 $ 200 $ 2,000 $1,400 $ 5,000 $ 8,600 Angel AG's ending inventory 25 percent are purchased from Mark AG and $1,100 of Mark AG's sales are sales to Angel AG. Required: Prepare a consolidation workpapers for Angel AG and subsidiary for the year ended December 31, 2014.
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Related Book For
Advanced Financial Accounting
ISBN: 978-0078025624
10th edition
Authors: Theodore E. Christensen, David M. Cottrell, Richard E. Baker
Posted Date:
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