Parent Corporation acquired an 80 percent interest in SubCorporation On January 2, 2011, for $2,800,000. 

On this date the capital stock and retained earnings of the two companies were as follows (in thousands):
                                                  Parent                    Sub
Capital stock ...................... $7,200 ................. $2,000
Retained earnings .............. 3,200 ..................... 400
The assets and liabilities of Sof were stated at fair values equal to book values when Parent acquired its 80 percent interest. Parent uses the equity method to account for its investment in Sub.
Net income and dividends for 2011 for the affiliated companies were as follows:
                                                                                  Parent                        Sub
Net income ........................................................... $1,200 ................... $360
Dividends declared ................................................... 720 ....................  200
Dividends payable December 31, 2011 .................. 360 .................... 100

REQUIRED
Calculate the amounts at which the following items should appear in the consolidated balance sheet on December 31, 2011.
1. Capital stock
2. Goodwill
3. Consolidated retained earnings
4. Noncontrolling interest
5. Dividends payable

Answer rating: 100% (QA)

Step 1 of 6 A P Corporation paid 2800000 on January 2 2011 for an 80 interest in S Corporation Capit... View the full answer