Parrot Company obtains some of the outstanding common stock of Sun Company on January 1, 2017....

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Parrot Company obtains some of the outstanding common stock of Sun Company on January 1, 2017. Parrot acquires Sun's 30% ownership interest for $250,000 in cash. Sun Company's balances are shown below: Book Values 1/1/17 Current assets. $320,000 Inventory 100,000 Trademarks (indefinite life). . . . . . . . 200,000 Patented technology (10-year life)... 320,000 Equipment (5-year life). Liabilities.... 180,000 (420,000) ... Common stock-$40 par value....$(200,000) Additional paid-in capital... ... (20,000) .(380,000) Retained earnings, 1/1/14. Fair Values 1/1/17 $ 320,000 80,000 220,000 450,000 150,000 (420,000) For 2017, Sun earned $90,000, declared cash dividends of $60,000, and paid dividends of $40,000.Sun' inventory is always measured in perpetual, FIFO and Equipment was estimated in straight line depreciation without salvage value Required: (1) What's realized Goodwill for this acquisition? What's recognized amount for this Goodwill? (2) What's amount of "Investment-Sun" on Parrot's 2017 Financial Statements? Prepare all related journal entries. Parrot Company obtains some of the outstanding common stock of Sun Company on January 1, 2017. Parrot acquires Sun's 30% ownership interest for $250,000 in cash. Sun Company's balances are shown below: Book Values 1/1/17 Current assets. $320,000 Inventory 100,000 Trademarks (indefinite life). . . . . . . . 200,000 Patented technology (10-year life)... 320,000 Equipment (5-year life). Liabilities.... 180,000 (420,000) ... Common stock-$40 par value....$(200,000) Additional paid-in capital... ... (20,000) .(380,000) Retained earnings, 1/1/14. Fair Values 1/1/17 $ 320,000 80,000 220,000 450,000 150,000 (420,000) For 2017, Sun earned $90,000, declared cash dividends of $60,000, and paid dividends of $40,000.Sun' inventory is always measured in perpetual, FIFO and Equipment was estimated in straight line depreciation without salvage value Required: (1) What's realized Goodwill for this acquisition? What's recognized amount for this Goodwill? (2) What's amount of "Investment-Sun" on Parrot's 2017 Financial Statements? Prepare all related journal entries.

Answer rating: 100% (QA)

1 caluculation of retained earning380000 less dividend declared 60000 Addearning Closing balance 2 ... View the full answer