Parrot Corporation acquired 90% of Swallow Co. on January 1, 2014 for $27,000 cash when Swallow's...
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Parrot Corporation acquired 90% of Swallow Co. on January 1, 2014 for $27,000 cash when Swallow's stockholders' equity consisted of $10,000 of Capital Stock and $5,000 of Retained Earnings. The difference between the fair value and book value of Swallow's net assets was allocated solely to a patent amortized over 5 years. The separate company statements for Parrot and Swallow appear in the first two columns of the partially completed consolidation working papers. Complete the consolidation working papers for Parrot and Swallow for the year 2014. Eliminations Parrot Swallow Consolidated Debit Credit INCOME STATEMENT Sales 20,000 2,970 (9,200) (2,300) 15,000 Income of Swallow Cost of Sales Other Expenses Noncontrolling Interest Share Net Income Retained Earnings 1/1 (4,700) (4,000) 11,470 6,300 11,000 5,000 Add: Net Income 11,470 6,300 Less: Dividends Retained Earnings 12/31 (3,000) (2,000) 19,470 9,300 BALANCE SHEET 2,000 Cash Accounts Receivahle 1,900 5,500 8,000 net 12.000 14,000 Inventories Patent Land Equipment and Buildings-net 27,000 42,000 60,000 43,000 Investment in Swallow Co. 28,170 TOTAL ASSETS 143.170 100,400 LIAB. & EQUITY Accounts Payable Capital Stock Retained earnings 1/1 Noocontrol 93,700 30,000 19.470 81,100 10,000 9,300 Interest 12/31 Noocontrol Interest TOTAL LIAB. & EQUITY 143,170 100,400 Parrot Corporation acquired 90% of Swallow Co. on January 1, 2014 for $27,000 cash when Swallow's stockholders' equity consisted of $10,000 of Capital Stock and $5,000 of Retained Earnings. The difference between the fair value and book value of Swallow's net assets was allocated solely to a patent amortized over 5 years. The separate company statements for Parrot and Swallow appear in the first two columns of the partially completed consolidation working papers. Complete the consolidation working papers for Parrot and Swallow for the year 2014. Eliminations Parrot Swallow Consolidated Debit Credit INCOME STATEMENT Sales 20,000 2,970 (9,200) (2,300) 15,000 Income of Swallow Cost of Sales Other Expenses Noncontrolling Interest Share Net Income Retained Earnings 1/1 (4,700) (4,000) 11,470 6,300 11,000 5,000 Add: Net Income 11,470 6,300 Less: Dividends Retained Earnings 12/31 (3,000) (2,000) 19,470 9,300 BALANCE SHEET 2,000 Cash Accounts Receivahle 1,900 5,500 8,000 net 12.000 14,000 Inventories Patent Land Equipment and Buildings-net 27,000 42,000 60,000 43,000 Investment in Swallow Co. 28,170 TOTAL ASSETS 143.170 100,400 LIAB. & EQUITY Accounts Payable Capital Stock Retained earnings 1/1 Noocontrol 93,700 30,000 19.470 81,100 10,000 9,300 Interest 12/31 Noocontrol Interest TOTAL LIAB. & EQUITY 143,170 100,400
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Related Book For
Intermediate Accounting 2014 FASB Update
ISBN: 978-1118147290
15th edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield
Posted Date:
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