The single-company financial statements of Parent Corp. and Son Ltd. at December 31, 2020 appear as...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
The single-company financial statements of Parent Corp. and Son Ltd. at December 31, 2020 appear as follows. Condensed Statement of Financial Position on December 31, 2020 Assets Current assets Cash and cash equivalens Trade and other receivables Inventories Non-current assets Deferred tax assets Investment in Baby (42,000 1$ shares at cost) Property, plan and equipment Liabilities & Equity Liabilities Current liabilities Trade paybales Loans repayable within 12 months Non-current liabilities Deferred tax liabitities Equity Shares capital Retained earnings Condensed Statement of Profit or Loss on December 31, 2020 Revenue Cost of sales Gross profit Operating expenses Parent Corp. $ Profit before taxation Income taxes Profit for the year 34,000 38,000 63,000 4,000 50,000 120,000 309,000 35,000 10,000 200,000 64,000 309,000 100,000 60,000 40,000 14,000 26,000 5,000 21,000 Son Ltd. $ 5,000 18,000 34,000 50,000 107,000 20,000 2,000 60,000 25,000 107,000 60,000 25,000 35,000 8,000 27,000 2,000 25,000 The following additional information affects the preparation of the consolidated financial statements. 1. Parent Corp. acquired 70 percent of the outstanding shares of Son Ltd. for $50,000 cash on January 1, 2020. At the time of acquisition, the book value of the shareholders' equity of Company S was $60,000 with no retained earnings. 2. At December 31, 2020, $10,000 of Son's accounts receivable represent amounts payable by Parent. 3. During 2020, Son sold merchandise to Parent for $25,000 and recorded $10,000 as the related cost of goods sold. None of that merchandise remains in Company P's inventory as of December 31, 2020. Require: Prepare the consolidated financial statements at December 31, 2020. Accounting entries are not required. The single-company financial statements of Parent Corp. and Son Ltd. at December 31, 2020 appear as follows. Condensed Statement of Financial Position on December 31, 2020 Assets Current assets Cash and cash equivalens Trade and other receivables Inventories Non-current assets Deferred tax assets Investment in Baby (42,000 1$ shares at cost) Property, plan and equipment Liabilities & Equity Liabilities Current liabilities Trade paybales Loans repayable within 12 months Non-current liabilities Deferred tax liabitities Equity Shares capital Retained earnings Condensed Statement of Profit or Loss on December 31, 2020 Revenue Cost of sales Gross profit Operating expenses Parent Corp. $ Profit before taxation Income taxes Profit for the year 34,000 38,000 63,000 4,000 50,000 120,000 309,000 35,000 10,000 200,000 64,000 309,000 100,000 60,000 40,000 14,000 26,000 5,000 21,000 Son Ltd. $ 5,000 18,000 34,000 50,000 107,000 20,000 2,000 60,000 25,000 107,000 60,000 25,000 35,000 8,000 27,000 2,000 25,000 The following additional information affects the preparation of the consolidated financial statements. 1. Parent Corp. acquired 70 percent of the outstanding shares of Son Ltd. for $50,000 cash on January 1, 2020. At the time of acquisition, the book value of the shareholders' equity of Company S was $60,000 with no retained earnings. 2. At December 31, 2020, $10,000 of Son's accounts receivable represent amounts payable by Parent. 3. During 2020, Son sold merchandise to Parent for $25,000 and recorded $10,000 as the related cost of goods sold. None of that merchandise remains in Company P's inventory as of December 31, 2020. Require: Prepare the consolidated financial statements at December 31, 2020. Accounting entries are not required.
Expert Answer:
Answer rating: 100% (QA)
IParent Corp Consolidated Statement of Financial Positio... View the full answer
Related Book For
Intermediate Accounting Volume 2
ISBN: 9781119497042
12th Canadian Edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Irene M. Wiecek, Bruce J. McConomy
Posted Date:
Students also viewed these accounting questions
-
Jen and Berry's sells ice-creams from its factory-shop in Petone. There is a managing director (Maynard Dibble), a marketing manager (Mary Salman) and a production manager (Peter Pritchard). Maynard...
-
Managing Scope Changes Case Study Scope changes on a project can occur regardless of how well the project is planned or executed. Scope changes can be the result of something that was omitted during...
-
The Crazy Eddie fraud may appear smaller and gentler than the massive billion-dollar frauds exposed in recent times, such as Bernie Madoffs Ponzi scheme, frauds in the subprime mortgage market, the...
-
1. What is differences between the ancient Mayan criminal justice system and modern criminal justice systems? 2. Does the legal system of the ancient Maya has any relevance to the modern world? File...
-
West Steel Company decided to spend $200,000 to purchase new state-of-the-art equipment for its manufacturing plant. The equipment has a five-year useful life and a salvage value of $50,000. It is...
-
Consider the density curve shown in Figure 3.4.5, which represents the distribution of diameters (measured 4.5 feet above the ground) in a population of 30-year-old Douglas fir trees. Areas under the...
-
Locate the state bar website for California. What information is provided there? Are there research sites available on the state bar website?
-
To ensure highway safety and protect driver health, Congress charged federal agencies with regulating the hours of service of commercial motor vehicle operators. Between 1940 and 2003, the...
-
The following dashboard shows Information on two alternative Investment projects a company is considering. Each project has a four- year life. The company requires an 8% rate of return on its...
-
New Horizons Co. is a high-tech firm whose owner does not have the required management expertise to run the firm. The owner wants to hire a manager with the required expertise. The continued success...
-
A slide at a playground forms a right triangle. The vertical ladder is 2.5m tall and the slide is 4m long. How far away is the end of the slide from the bottom of the ladder?
-
Describe the three qualities of negotiable instruments that distinguish such instruments from ordinary assignments. How do these qualities make them commercially useful?
-
What are the limits of ratification by a principal?
-
Why might an inventor choose not to register a patent?
-
Are there any advantages to be gained in registering a trademark?
-
What is meant by an industrial design?
-
please consider the creation of GPS navigation technology. How might a technological determinism approach address the introduction of this technology differently than a social construction of...
-
"Standard-cost procedures are particularly applicable to process-costing situations." Do you agree? Why?
-
Laurentian Mills Ltd. had the following shareholders' equity at January 1, 2020. The contributed surplus accounts arose from amounts received in excess of the par value of the shares when issued....
-
Zak Corp. purchased depreciable assets costing $600,000 on January 2, 2020. For tax purposes, the company uses CCA in a class that has a 40% rate. Assume these assets are considered eligible...
-
The following information (in $000) has been obtained from Patinka Limited's financial statements for the fiscal years ended December 31. There were no preferred shares issued by Patinka nor were...
-
How reliable is the model in Task 6? Task 6 An HIV researcher explored the factors that influenced condom use with a new partner (relationship less than 1 month old). The outcome measure was whether...
-
An HIV researcher explored the factors that influenced condom use with a new partner (relationship less than 1 month old). The outcome measure was whether a condom was used (use: condom used = 1, not...
-
A female who used a condom in her previous encounter scores 2 on all variables except perceived risk (for which she scores 6). Use the model in Task 6 to estimate the probability that she will use a...
Study smarter with the SolutionInn App