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On January 1, 2016, Alpha acquired 80 percent of Delta. Of Delta's total business fair value, $157,000 was allocated to copyrights with a 20-year remaining life. Subsequently, on January 1, 2017, Delta obtained 70 percent of Omega's outstanding voting shares. In this second acquisition, $126,600 of Omega's total business fair value was assigned to copyrights that had a remaining life of 12 years. Delta's book value was $635,000 on January 1, 2016 and Omega reported a book value of $159,500 on January 1, 2017 Delta has made numerous inventory transfers to Alpha since the business combination was formed. Intra-entity gross profits of $22,200 were present in Alpha's inventory as of January 1, 2018. During the year, $223,000 in additional intra-entity sales were made with $24,530 in Intra-entity gross profits in inventory remaining at the end of the period. Both Alpha and Delta utilized the partial equity method to account for their investment balances. Following are the individual financial statements for the companies for 2018 with consolidated totals. Alpha Company $(1,117,200) 571,00 393, 000 (189,880) $ (334,000) Delta Company $ (582,520) 278,000 132,000 (53.480) $ (226,ese) Omega Company $ (285,980) 143, eee 66,500 @ $ (76,400) Consolidated Totals $(1,762,620) 771,330 609,900 $ (381, 390) Sales Cost of goods sold Operating expenses Income of subsidiary Separate company net income Consolidated net income Net income attributable to non controlling interest (Delta Company] Net income attributable to non controlling interest (Omega Company) Net income attributable to Alpha Company Retained earnings, 1/1/18 Net income (above) Dividends declared Retained earnings, 12/31/18 Cash and receivables Inventory Investment in Delta Company Investment in Omega Company Property. plant, and equipment Copyrights Total assets 41,687 $ (822,500) (334,00) 50,00 $(1, 106,5eo) $ 452,100 357.ee 806, 400 $ (545,000) (226,000) 40,000 $ (731,000) $ 247.250 345,000 $ (119,500) (76,400) 60.eee $ (135,900) $ 97.900 193, see 19,755 $ (319,948) $ (786,272) (319, 948) 50, esa $(1,056,220) $ 797, 25e 870, 470 516,000 253,750 515,000 299, see $ 2,131,500 $ 1,31,000 $589,900 1.330, cea 238,950 $ 3, 236,670 1,301,00 $ (825,000) $ (510,000) $ (354,600) $(1,689,880) (200,000) (120,000) (100,000) (200, 800) (1,106,500) (731, 000) (135,900) (1,056,220) (189,030) (102,420) $(2,131,500) $(1,361,000) $ (589,900) $(3,236,670) Develop the worksheet entries necessary to derive these reported balances: (if no entry is required for a transaction/event, selec "No journal entry required" in the first account field.) Answer is not complete. Accounts No Transaction Credit 1 1 Debit 22,200 Retained earnings (Delta) Cost of goods sold 22,200 2 2 Retained earnings (Delta) Investment in Omega 7,385 7,385 3 3 Retained earnings (Alpha) Investment in Delta 36,228 36,228 4 Common stock (Omega) Retained earnings (Omega) Investment in Omega Noncontrolling interest in Omega OO 100,000 119.500 153,650 65,850 5 5 Common stock (Delta) Retained earnings (Delta) 120,000 65,567 120,000 5 5 Common stock (Delta) Retained earnings (Delta) Investment in Delta Noncontrolling interest in Delta 65,567 8,765 126,936 6 6 257,350 Copyrights Investment in Delta Investment in Omega Noncontrolling interest in Delta Noncontrolling interest in Omega 113,040 81,235 28,260 34,815 7 7 180,800 Income of subsidiary Investment in Delta 180,800 8 8 Income of subsidiary Investment in Omega 53,480 Oo 53,480 9 9 Investment in Delta Dividends Declared (Delta) 32,000 > 0 32,000 10 10 Investment in Omega Dividends Declared (Omega) 42,000 O 42,000 11 11 Operating expenses Copyrights 18,400 18.400 Investment in Omega Noncontrolling interest in Delta Noncontrolling interest in Omega 81,235 28,260 34,815 180,800 7 7 Income of subsidiary Investment in Delta 180,800 53,480 8 8 Income of subsidiary Investment in Omega 53,480 9 9 32,000 Investment in Delta Dividends Declared (Delta) 32,000 > 10 10 42,000 Investment in Omega Dividends Declared (Omega) 42,000 11 11 18,400 Operating expenses Copyrights 00 18,400 12 12 Sales Cost of goods sold 223,000 lo 223,000 13 13 Cost of goods sold Inventory 24,530 24,530 Consolidation Worksheet Entries
