Chapter 07 – Intercompany Transfers of Noncurrent Assets and Services
P7-32 (continued)
c.
Prime Company and Subsidiary
Consolidated Balance Sheet
December 31, 20X6
Cash and Receivables
$
141,000
Inventory
350,000
Land
150,000
Buildings and Equipment
$655,000
Less: Accumulated Depreciation
(273,000)
382,000
Goodwill
32,000
Total Assets
$1,055,000
Accounts Payable
$ 73,000
Bonds Payable
250,000
Stockholders’ Equity:
Controlling Interest:
Common Stock
$300,000
Retained Earnings
379,600
Total Controlling Interest
$679,600
Total Noncontrolling Interest
52,400
Total Stockholders’ Equity
732,000
Total Liabilities and Stockholders’ Equity
$1,055,000
Prime Company and Subsidiary
Consolidated Income Statement
Year Ended December 31, 20X6
Sales
$ 370,000
Cost of Goods Sold
$200,000
Depreciation and Amortization Expense
38,000
Goodwill Impairment Loss
18,000
Other Expenses
20,000
Total Expenses
(276,000)
Consolidated Net Income
$
94,000
Income to Noncontrolling Interest
(6,400)
Income to Controlling Interest
$
87,600
Prime Company and Subsidiary
Consolidated Retained Earnings Statement
Year Ended December 31, 20X6
Retained Earnings, January 1, 20X6
$
322,000
Income to Controlling Interest, 20X6
87,600
$
409,600
Dividends Declared, 20X6
(30,000)
Retained Earnings, December 31, 20X6
$
379,600
