130 CHAPTER 4 P 4-6 Workpapers (determine ownership interest, year after acquisition, excess assigned to land and patents) Separate company financial statements for Pen Corporation and its subsidiary, Syn Company, at and for the year ended December 31, 2012, are summarized as follows (in thousands): Pen Syn Combined Income and Retained Earnings Statements for the Year Ended December 31 Sales S 800 $200 Income from Syn 36 Cost of sales (500) (100) Other Expenses (2012) Net income 134.8 Add: Retained earnings January 354 Deduct: Dividends (100) (32) Retained earnings December 31 S 388.8 $ 84 Balance Sheet at December 31 Cash 36 $ 30 Accounts receivable--net 160 40 Dividends receivable from Syn 14.4 Note receivable from Pen 10 Inventory 190 20 Investment in Syn 439.2 Land 130 60 Buildings-net 340 160 Equipment-net 260 100 Total assets S1.569.6 $420 Accounts payable S 170.8 $ 20 Note payable to Syn Dividends payable 16 Capital stock. $20 par 1.000 Retained earnings 388.8 84 Total equities S1,569,6 $420 139482 S 10 300 ADDITIONAL INFORMATION 1. Pen Corporation acquired 13,500 shares of Syn Company stock for $30 per share on January 1, 2011. when Syn's stockholders' equity consisted of $300,000 capital stock and $30.000 retained earnings 2. Syn Company's land was undervalued when Pen acquired its interest, and accordingly, $40,000 of the fair value/book value differential was assigned to land. Any remaining differential is assigned to unrecorded patents with a 10-year remaining life 3. Syn Company owes Pen $10,000 on account, and Pen awes Syn $10,000 on a note payable. REQUIRED: Prepare consolidated workpapers for Pen Corporation and Subsidiary for the year ended December 31, 2012 P4-6 (2).XLS G Open with Microsoft Exc 0.0) NAME HERE PEN CORPORATION AND SUBSIDIARY P4-6 CONSOLIDATION WORKSHEET FOR THE YEAR ENDED DECEMBER 31, 2012 90% Adjustments & Eliminations Consolidated Pen Debits Credits Statements (in thousands) Syn INCOME SITEMENT 200.0 1000.0 Sales 800.0 Income from Syn 36.0 36.0 Cost of sales (500.0) (100.0) (600.0) Other expenses (2012) (253.2) (52.0) 182.8 Consolidated NI Noncontr. interest share 134.8 48.0 Controlling share of NI 1828 RETAINED EARNINGS Retained earnings Pen 354.0 354.0 Retained earnings-Syn 68.0 68.0 | Controlling share of NI 134.81 48.0 | 182.8 Dividends (100.0) (32.0) (132.0) Retained earnings-- 12/31 388.8 84.0 472.8 BALANCE SHEET Cash 36.0 30.0 66.0 Accounts receivable 160.0 40.0 200.0 Dividends receivable 14.41 14.4 Inventories 190.0 20.01 210.0 Note receivable-Pen 10.0 Investment in Syn 439.21 439.2 Land 130.0 60.00 Buildings.net 160.0 500.0 Equipment-net 260.0 100.0 360.0 Patents 0.0 Total Assets 1569.6 4200 1989.6 Accounts payable 170.8 20.0 Note payable to Syn 10.0 190.8 Dividends payable 10.0 Capital stock 1000.0 300.0 16.0 388.8 1300.0 15696 420.0 Noncontrolling interest 10.0 340.0 190.0 16.01 Retained earnings Total cquities 84.0 472.8 0.0 0.0 1989.6 0.0 00