Business
Business, 12.08.2020 18:01, johnsonkia873

Assume that a parent company acquired a subsidiary on January 1, 2010. The purchase price was $500,000 million in excess of the subsidiary's book value of Stockholders' Equity on the acquisition date, and that excess was assigned to the following AAP assets: AAP Asset
Original
Amount
Original Useful
Life (years)
Property, plant and equipment (PPE), net
$100,000
20
Customer list
165,000
10
Royalty agreement
135,000
10
Goodwill
100,000
indefinite
$500,000
The AAP assets with a definite useful life have been amortized as part of the parent's equity method accounting. The Goodwill asset has been tested annually for impairment, and has not been found to be impaired.
Assume that the parent company sells inventory to its wholly owned subsidiary. The subsidiary, ultimately, sells the inventory to customers outside of the consolidated group. You have compiled the following data for the years ending 2012 and 2013:
Inventory
Sales
Gross Profit
Remaining
in Unsold
Inventory
Receivable
(Payable)
2013
$68,000
$19,580
$27,400
2012
$43,700
$12,797
$13,437
The inventory not remaining at the end of the year has been sold to unaffiliated entities outside of the consolidated group. The parent uses the equity method to account for its Equity Investment.
The financial statements of the parent and its subsidiary for the year ended December 31, 2013, follow in part d. below.
a. Show the computation to yield the pre-consolidation $69,837 Income (loss) from subsidiary reported by the parent during 2013. Hint: Use negative signs with answers when appropriate.
b. Show the computation to yield the Equity Investment balance of $959,789 reported by the parent at December 31, 2013. Hint: Use negative signs with answers when appropriate.
Common stock
APIC
Retained earnings
BOY unamortized AAP
BOY deferred profit
Income (loss) from subsidiary
Dividends
Equity investment
c. Prepare the consolidation journal entries for the year ended December 31, 2013. d. Prepare the consolidation spreadsheet for the year ended December 31, 2013. Hint: Use negative signs with answers when appropriate.
d. Prepare the consolidation spreadsheet for the year ended December 31, 2013. Hint: Use negative signs with answers when appropriate.

answer
Answers: 3

Other questions on the subject: Business

image
Business, 22.06.2019 01:20, tsadface21
Suppose a stock had an initial price of $65 per share, paid a dividend of $1.45 per share during the year, and had an ending share price of $58. a, compute the percentage total return. (a negative answer should be indicated by a minus sign. do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e. g., 32.16.) b. what was the dividend yield and the capital gains yield? (a negative answer should be indicated by a minus sign. do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e. g., 32.16.)
Answers: 2
image
Business, 22.06.2019 14:20, ssalusso7914
Cardinal company is considering a project that would require a $2,725,000 investment in equipment with a useful life of five years. at the end of five years, the project would terminate and the equipment would be sold for its salvage value of $400,000. the company’s discount rate is 14%. the project would provide net operating income each year as follows: sales $2,867,000 variable expenses 1,125,000 contribution margin 1,742,000 fixed expenses: advertising, salaries, and other fixed out-of-pocket costs $706,000 depreciation 465,000 total fixed expenses 1,171,000 net operating income $571,000 1. which item(s) in the income statement shown above will not affect cash flows? (you may select more than one answer. single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. any boxes left with a question mark will be automatically graded as incorrect.) (a)sales (b)variable expenses (c) advertising, salaries, and other fixed out-of-pocket costs expenses (d) depreciation expense 2. what are the project’s annual net cash inflows? 3.what is the present value of the project’s annual net cash inflows? (use the appropriate table to determine the discount factor(s) and final answer to the nearest dollar amount.) 4.what is the present value of the equipment’s salvage value at the end of five years? (use the appropriate table to determine the discount factor(s) and final answer to the nearest dollar amount.) 5.what is the project’s net present value? (use the appropriate table to determine the discount factor(s) and final answer to the nearest dollar amount.)
Answers: 2
image
Business, 22.06.2019 15:20, babyduck0664
Martinez company has the following two temporary differences between its income tax expense and income taxes payable. 2017 2018 2019 pretax financial income $873,000 $866,000 $947,000 (2017' 2018, 2019) excess depreciation expense on tax return (29,400 ) (39,000 ) (9,600 ) (2017' 2018, 2019) excess warranty expense in financial income 20,000 9,900 8,300 (2017' 2018, 2019) taxable income $863,600 $836,900 $945,700(2017' 2018, 2019) the income tax rate for all years is 40%. instructions: a. prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2017, 2018, and 2019. b. assuming there were no temporary differences prior to 2016, indicate how deferred taxes will be reported on the 2016 balance sheet. button's warranty is for 12 months. c. prepare the income tax expense section of the income statement for 2017, beginning with the line, "pretax financial income."
Answers: 3
image
Business, 22.06.2019 19:50, ParallelUniverse
Our uncle has $300,000 invested at 7.5%, and he now wants to retire. he wants to withdraw $35,000 at the end of each year, starting at the end of this year. he also wants to have $25,000 left to give you when he ceases to withdraw funds from the account. for how many years can he make the $35,000 withdrawals and still have $25,000 left in the end? a. 14.21b. 14.96c. 15.71d. 16.49e. 17.32
Answers: 1
Do you know the correct answer?
Assume that a parent company acquired a subsidiary on January 1, 2010. The purchase price was $500,0...

Questions in other subjects:

Konu
Business, 18.11.2020 01:00
Konu
Mathematics, 18.11.2020 01:00