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Additional Information The notes payable are intercompany. Required: a ) Prepare the Year 6 consolidated financial statements. ( Input all values as positive numbers. Leave

Additional Information
The notes payable are intercompany.
Required:
a) Prepare the Year 6 consolidated financial statements. (Input all values as positive numbers. Leave no cells blank - be certaln to
enter "0? wherever required. Round your Intermedlate computations to nearest whole dollar value. Omit $ sign in your response.
The balance sheet total may vary due to rounding.)(b) Calculate goodwill impairment loss and non-controlling interest on the consolidated income statement for the year ended December 31, Year 6, under the identifiable net assets method. (Round Intermedlate calculations and final answers to whol= number. Omit $ sign In your response.)
Goodwill irpairnent loss
$
NCI - identifiable net assets nethodOSullivan Corp. purchased 75% of the outstanding shares of Rabb Ltd. on January 1, Year 3, at a cost of $131,920. Non-controlling interest was valued at $49,000 by an independent business valuator at the date of acquisition. On that date, Rabb had common shares of $57,000 and retained earnings of $37,000. Fair values were equal to carrying amounts for all the net assets except the following:
Carrying Amount Fair Value
Inventory $ 37,000 $ 22,500
Equipment 46,40072,500
Software 18,500
________________________________________
The equipment had an estimated remaining useful life of six years on January 1, Year 3, and the software was to be amortized over ten years. Foxx uses the cost method to account for its investment. The testing for impairment at December 31, Year 6, yielded the following fair values:
Software $ 9,400
Goodwill 55,105
________________________________________
The impairment loss on these assets occurred entirely in Year 6. Amortization expense is grouped with administrative expenses, and impairment losses are grouped with miscellaneous expenses. The parents share of the goodwill noted above is $37,673.
The following are the financial statements of OSullivan Corp. and its subsidiary Rabb Ltd. for Year 6:
BALANCE SHEETS
At December 31, Year 6
OSullivan Corp. Rabb Ltd.
Cash $ $ 10,700
Accounts receivable 47,00037,000
Note receivable 47,000
Inventory 73,00051,000
Equipment, net 255,00083,000
Land 185,00037,000
Investment in Rabb 131,920
$ 691,920 $ 265,700
Bank indebtedness $ 125,000 $
Accounts payable 77,00067,000
Notes payable 47,000
Common shares 157,00057,000
Retained earnings 285,920141,700
$ 691,920 $ 265,700
________________________________________
STATEMENTS OF RETAINED EARNINGS
Year ended December 31, Year 6
OSullivan Corp. Rabb Ltd.
Retained earnings, January 1, Year 6 $ 188,000 $ 127,000
Net income 133,47548,000
Dividends (35,555)(33,300)
Retained earnings, December 31, Year 6 $ 285,920 $ 141,700
________________________________________
INCOME STATEMENTS
For the year ended December 31, Year 6
OSullivan Corp. Rabb Ltd.
Sales $ 828,000 $ 341,000
Investment income 24,9757,100
852,975348,100
Cost of sales 487,000207,000
Administrative expenses 43,50015,500
Miscellaneous expenses 123,00038,600
Income taxes 66,00039,000
719,500300,100
Net income $ 133,475 $ 48,000
________________________________________
Additional Information
The notes payable are intercompany.
Required:
(a) Prepare the Year 6 consolidated financial statements. (Input all values as positive numbers. Leave no cells blank - be certain to enter "0" wherever required. Round your intermediate computations to nearest whole dollar value. Omit $ sign in your response. The balance sheet total may vary due to rounding.)
OSullivan Corp.
Statement of Consolidated Retained Earnings
Year ended December 31, Year 6
(Click to select) Balance January 1 Balance December 31 $
(Click to select) Net loss Net income
(Click to select) Less: Dividends Add: Dividends
(Click to select) Balance January 1 Balance December 31 $
________________________________________
(b) Calculate goodwill impairment loss and non-controlling interest on the consolidated income statement for the year ended December 31, Year 6, under the identifiable net assets method. (Round intermediate calculations and final answers to whole number. Omit $ sign in your response.)
Goodwill impairment loss $
NCI identifiable net assets method
________________________________________
(c) This part of the question is not part of your Connect assignment.
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