Bolero Company holds 80 percent of the common stock of Rivera, Inc., and 40 percent of this subsidiary's convertible bonds. The following consolidated financial statements are for 2017 and 2018:

Additional Information for 2018
ˆ™ The parent issued bonds during the year for cash.
ˆ™ Amortization of databases amounts to $15,000 per year.
ˆ™ The parent sold a building with a cost of $80,000 but a $40,000 book value for cash on May 11.
ˆ™ The subsidiary purchased equipment on July 23 for $205,000 in cash.
ˆ™ Late in November, the parent issued stock for cash.
ˆ™ During the year, the subsidiary paid dividends of $10,000. Both parent and subsidiary pay dividends in the same year as declared.
Prepare a consolidated statement of cash flows for this business combination for the year ending December 31, 2018. (Use indirect method.)

Transcribed Image Text:

Bolero Company and Consolidated Subsidiary Rivera 2017 2018 Revenues Cost of goods sold Depreclation and amortization Galn on sale of bullding Interest expense Consolidated net Income $ (900,000) 610,000 100,000 $(1,030,000) 650,000 120,000 (30,000) 40,000 40,000 (150,000) 19,000 (250,000) 21,000 to noncontrolling Interest to parent company $ (131 $ (229 Bolero Company and Consolidated Subsidiary Rivera 2017 2018 $ (310,000) (131,000) 60,000 $ (381,000) (229,000) 110,000 Retalned earnings, 1/1 Net Income Dividends declared Retalned earnings, 12/31 Cash Accounts recelvable Inventory Buildings and equipment (net) Databases Total assets $ (381.000 $ 90,000 170,000 210,000 650,000 170,000 $ 1,290,000 $ (500,000 $ 180,000 150,000 360,000 710,000 155,000 1,555,000 Accounts payable Bonds payable Noncontrolling Interest In Rivera Common stock Additlonal pald-In capital Retalned earnings $(160,000) (410,000) (42,000) (110,000) (187,000) $(110,000) (520,000) (61,000) (140,000) (224,000) 381 Total Ilablities and equities. 1,290,0 1,555