I need this sheet completed, I dont balance in the end for some reason?
Acquisition details:
The parent acquired 75% of the sub in 2012.
the only differential is due to goodwill. The good will attributable to the parent is $150.
Pricing to the NCI is proportional.
The goodwill has not impaired since acquisition date.
ADDITIONAL INFORMATION
Intercompany merchandise sales totalled $300,000 during 2015. All intercompany balances have been
paid except for $50,000 in transit at December 31, 2015.
Unrealized profits in S?s inventory of merchandise purchased from P were $48,000 on December
31, 2014, and $60,000 on December 31, 2015.
S sold equipment with a six-year remaining life to P on January 3, 2013, at a gain of $96,000. P
still uses the equipment in its operations.
P sold land to S on July 1, 2015, at a gain of $40,000. S still holds the land at December 31, 2015.
P sold a building to S on July 1, 2015, at a gain of $80,000. The building has a 10-year remaining
life and is still used by Sum.
round above amounts to thousands.
REQUIRED:
Required: Carefully Follow and label each step. Show all work below on the spreadsheet tab.
1.Calculate the full amount of goodwill. Identify amounts attributable to the parent and
the NCI
2. Analyze each intercompany transaction. Label as either upstream
downstream.
3. Calculate Net income to the controlling interest for the year 2015
4. Verify the calculation of the balance in the acccount equity in sub
earnings and record the parent company entries with respect to its investment during 2015
5. Prepare all elimination entries for 2015.
6. Complete the consolidating spreadsheet for the year ended 2015.
7. Answer questions on the blue tab
the parent uses the equity method
INCOME STATEMENT
FYE 12/31/2015
Sales
Equity in sub earnings
Gain on building
Gain on land
Total revenues
P
S
ELIMINATIONS
DR
CR
CONS.TOT.
2,520
184
80
40
2,824
2,000
1,400
304
80
184
1,968
856
1,200
160
856
400
2,600
464
80
424
3,568
1,256
0
1,256
Retained Earnings 1/1
750
400
1,150
Net income
856
400
1,256
Dividends declared
640
320
960
Retained Earnings 12/31
966
480
1,446
108
276
20
120
200
384
20
280
520
0
640
1,320
920
1,498
424
0
0
6,006
Cost of goods sold
Depreciation Expense
Interest Expense
Other expenses and losses
Total expenses
Total Net income
Less net income to NCI
Net income to controlling interest
4,520
184
80
40
4,824
2,000
240
1,600
400
RETAINED EARNINGS
STATEMENT
BALANCE SHEET
cash
Bond interest receivable
Other receivables-net
Inventory
160
320
Land
Buildings, net
Equipment, net
Investment in S
Available for sale securities
goodwill
360
600
560
1,498
Total assets
3,606
2,400
Accounts payable
Bond interest payable
10% bonds payable
Common stock
200
40
800
1,600
320
1,600
966
480
3,606
0
2,400
0
Retained earnings
noncontrolling interest
Total liabilities and equity
dr common stk
dr RE
dr Goodwill
cr equipement, net
cr cogs
cr depr exp
cr Investment in sub
cr NCI
424
1,600
400
200
48
48
16
1554
534
2,200
dr equity in sub earnings
cr dividends dec
dr investment in s
dr net income to nci
cr dividends declared
cr nci
dr sales
cr cogs
dr payables
cr receivables
280
720
360
2,200
184
240
56
#REF!
80
#REF!
300
300
50
50
0
0
520
40
800
3,200
0
1,446
0
6,006
0
dr cogs
cr inventory
#REF!
#REF!
dr gain on land sale
cr land
40
dr gain on building sale
cr building, net
cr depreciation expense
80
40
76
4
#REF! #REF!
DO NOT CHANGE ANY FORMATTING ON THIS WORKSHEET
Use cell references from Spreadsheet tab to answer questions.
1. What is the Parent Company ONLY Confirmed net income?
2. What is the sub's Confirmed net income?
3. What is the net income to the NCI (enter as a positive amount)?
4. What are consolidated sales?
5. What are consolidated cost of goods sold?
6. What is consolidated depreciation expense?
7. What are consolidated total assets?
8. What is consolidated inventory?
9. What is consolidated equipment,net?
10. What is consolidated building, net?
11. What are consolidated other receivables?
12. What is consolidated goodwill?
13. What is consolidated accounts payable?
14. What is the balance for NCI as of 12/31/2015?
15. What is consolidated retained earnings as of 12/31/2015?
enter answers in shaded boxes
Prepare the consolidated balance sheet with supporting elimination entries
Partial credit up to an additional 10 points.