Pop Corporation paid $3,600,000 for a 90 percent interest in Son Corporation on January 1, 2016; Son's

Question:

Pop paid $3,600,000 for a 90 percent interest in Son on January 1, 2016; Son's total book value was $3,600,000. The excess was allocated as follows: $120,000 to undervalued equipment with a three-year remaining useful life and $280,000 to . The income statements of Pop and Son for 2016 are summarized as follows (in thousands):
_______________________ Pop __________________ Son
Sales .......................... $8,000 ....................... $3,200
Income from Son ............. 360
Cost of sales ................ (4,000) ...................... (1,600)
Depreciation expense ....... (800) ......................... (480)
Other expenses ............. (1,600) ........................ (720)
Net income .................. $ 1,960 ........................ $ 400
Required
1. Calculate the that should appear in the consolidated of Pop and Subsidiary at December 31, 2016.
2. Calculate consolidated net income for 2016?
Goodwill
Goodwill is an important concept and terminology in accounting which means good reputation. The word goodwill is used at various places in accounting but it is recognized only at the time of a business combination. There are generally two types of... Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial... Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...