On January 1, 20X1, Parent purchased shares of Subsidiary. The accountant started the financial statements below,...

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On January 1, 20X1, Parent purchased shares of Subsidiary. The accountant started the financial statements below, but could not finish them. She also could not produce a statement of cash flows. You have decided to help her out because you are the well- trained Kangaroo and therefore an SCF expert. Note, you are NOT required to produce the direct method of disclosing operating cash flows. The Company uses the EQUITY method of accounting for this investment. Shares of Subsidiary outstanding Shares of Subsidiary acquired Cost per share Subsidiary's income in 20X1 Amortization expense Depreciation expense Interest expense Pretax income Parent Company Income Statement for the year ended December 31, 20X1 Sales $ 755,000 Income from Subsidiary Cost of goods sold Salary expense Tax expense Net income Parent Company Balance Sheet as of December 31 Cash Accounts receivable Inventory Investment in Subsidiary Equipment Accumulated depreciation Patent Land Total Accounts payable Taxes payable $ Deferred taxes payable - Depreciation Dividends payable Notes payable Common stock ($1 par value) Additional paid-in capital Retained earnings Total 80,000 8,000 4.50 25,000 $ 337,000 291,000 4,000 37,000 8,000 20X0 49,600 $ 34,300 19,800 0 338,900 (108,400) 40,000 45,500 $ 419,700 $ 89,600 $ 13,000 16,900 1,100 156,200 47,200 68,500 27,200 $ 419,700 20X1 33,200 38,510 17,190 422,600 (145,400) 36,000 62,800 116,400 700 144,300 52,900 76,700 100% of the amortization of excess Subsidiary's dividends in 20X1 Tax rate Estimated tax payment Tax depreciation Statement of Retained Earnings for the year ended December 31, 20X1 Beginning retained earnings $ Net income Dividends Ending retained earnings Absolute Value of Change 4,210 2,610 83,700 37,000 4,000 17,300 26,800 400 11,900 5,700 8,200 9,000 4,000 30.00% 7,000 56,000 27,200 (5,600) On January 1, 20X1, Parent purchased shares of Subsidiary. The accountant started the financial statements below, but could not finish them. She also could not produce a statement of cash flows. You have decided to help her out because you are the well- trained Kangaroo and therefore an SCF expert. Note, you are NOT required to produce the direct method of disclosing operating cash flows. The Company uses the EQUITY method of accounting for this investment. Shares of Subsidiary outstanding Shares of Subsidiary acquired Cost per share Subsidiary's income in 20X1 Amortization expense Depreciation expense Interest expense Pretax income Parent Company Income Statement for the year ended December 31, 20X1 Sales $ 755,000 Income from Subsidiary Cost of goods sold Salary expense Tax expense Net income Parent Company Balance Sheet as of December 31 Cash Accounts receivable Inventory Investment in Subsidiary Equipment Accumulated depreciation Patent Land Total Accounts payable Taxes payable $ Deferred taxes payable - Depreciation Dividends payable Notes payable Common stock ($1 par value) Additional paid-in capital Retained earnings Total 80,000 8,000 4.50 25,000 $ 337,000 291,000 4,000 37,000 8,000 20X0 49,600 $ 34,300 19,800 0 338,900 (108,400) 40,000 45,500 $ 419,700 $ 89,600 $ 13,000 16,900 1,100 156,200 47,200 68,500 27,200 $ 419,700 20X1 33,200 38,510 17,190 422,600 (145,400) 36,000 62,800 116,400 700 144,300 52,900 76,700 100% of the amortization of excess Subsidiary's dividends in 20X1 Tax rate Estimated tax payment Tax depreciation Statement of Retained Earnings for the year ended December 31, 20X1 Beginning retained earnings $ Net income Dividends Ending retained earnings Absolute Value of Change 4,210 2,610 83,700 37,000 4,000 17,300 26,800 400 11,900 5,700 8,200 9,000 4,000 30.00% 7,000 56,000 27,200 (5,600)

Answer rating: 100% (QA)

1 Sales revenue A Costs Direct materials Particulars Less Selling and administrative NOL 2 400800 16... View the full answer