Question
A parent company of a 60%-owned subsidiary uses the cost method. At the end of 2001, the parent made the following consolidation entry, among others:
A parent company of a 60%-owned subsidiary uses the cost method. At the end of 2001, the parent made the following consolidation entry, among others: The NCI entry:
Common Stock 4000 Additional Paid-in Capital 200000 Retained Earnings, 1/1/01 30000 NCI in Net Income. Dividends Declared 16000 NCI in Net Assets240000. The parent also declared and paid dividends of $800,000 in 2001. Required What is the amount for each of the following items?
a. The subsidiary's retained earnings balance at 12/31/01.
b. The subsidiary's total equity at 12/31/01.
c. The parent's year-end investment balance under the cost method.
d. The parent's year-end investment balance under the equity method.
e. The dividends declared by the subsidiary in 2001.
f. The amount reported for dividends declared in the 2001 consolidated statement of retained earnings
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