On January 1, 2015 ,Pub Corporation made a significant acquisition, purchasing 75 percent of Sub Corporation's outstanding voting stock for a total of $4,200,000. Sub Corporation's stockholders' equity at that time was made up of the following components (all values in thousands): Capital stock with a par value of $10: $2,000 Additional paid-in capital: $1200 Retained earnings as of December 31, 2014: $1500 Total stockholders' equity: $4700 The surplus fair value of the net assets obtained from this acquisition was allocated as follows: 10 percent to underappreciated inventory (which was subsequently sold in 2015), 40 percent to underappreciated plant assets with a remaining useful life of eight years, and the remaining 50 percent to goodwill. Fast forward to December 31, 2019, and we have the comparative trial balances for both Pub Corporation and Sub Corporation. Pub Sub Other assets—net $5,845 $4500 Investment in Sub— 75% 3,640 — Expenses (including cost of sales) 5,285 800 Dividends 600 300 $15370 5600 Capital stock, $10 par $4,000 $2,000 Additional paid-in capital 850 1200 Retained earnings 2,670 1500 Sales 7380 900 Income from Sub 470 — $15370 $5600 Determine the amounts that would appear in the consolidated financial statements of Pub Corporation and Sub for each of the following: 1.Goodwill at December 31, 2019 2.Non-controlling interest share for 2019 3.Consolidated retained earnings at December 31, 2018 4.Consolidated retained earnings at December 31, 2019 5.Consolidated net income for 2019 6.Non-controlling interest at December 31, 2018 7.Non-controlling interest at December 31, 2019
Corporation's outstanding voting stock for a total of $4,200,000. Sub Corporation's stockholders'
equity at that time was made up of the following components (all values in thousands):
Capital stock with a par value of $10: $2,000
Additional paid-in capital: $1200
Total
The surplus fair value of the net assets obtained from this acquisition was allocated as follows: 10
percent to underappreciated inventory (which was subsequently sold in 2015), 40 percent to
underappreciated plant assets with a remaining useful life of eight years, and the remaining 50 percent
to
Fast forward to December 31, 2019, and we have the comparative
Corporation and Sub Corporation.
Pub Sub
Other assets—net $5,845 $4500
Investment in Sub— 75% 3,640 —
Expenses (including cost of sales) 5,285 800
Dividends 600 300
$15370 5600
Capital stock, $10 par $4,000 $2,000
Additional paid-in capital 850 1200
Retained earnings 2,670 1500
Sales 7380 900
Income from Sub 470 —
$15370 $5600
Determine the amounts that would appear in the consolidated financial statements of Pub
Corporation and Sub for each of the following:
1.Goodwill at December 31, 2019
2.Non-controlling interest share for 2019
3.Consolidated retained earnings at December 31, 2018
4.Consolidated retained earnings at December 31, 2019
5.Consolidated net income for 2019
6.Non-controlling interest at December 31, 2018
7.Non-controlling interest at December 31, 2019
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