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Adjusted trial balances Home office Branch dr (cr dr (cr) Eliminations dr (cr) Combined dr (cm) Income statement Sales Cost of goods sold 1 414
Adjusted trial balances Home office Branch dr (cr dr (cr) Eliminations dr (cr) Combined dr (cm) Income statement Sales Cost of goods sold 1 414 710 1 0818 Bl3101010 243100 42 ololo Operating expenses Net income (to statement of retained earnings below) Totals 44000 - 10 915 12 10 - 10 314 010) 9520 Statement of retained earnings Retained earnings, Jan. 1, 2005 Net (income) (from income statement above) Dividends declared Retained earnings, Dec. 31, 2005 (to balance sheet below) Totals 144000) 15 000 23700 1197 30000 0 Balance sheet Cash Inventories, Dec. 31, 2005 Investment in branch Allowance for overvaluation of branch inventories 5 8300 11000 40 8 19 7 0 0 0 350 DIC (200000 75 Other assets (net) Current liabilities Common stock, $2.50 par Retained earnings (from statement of retained earnings above) Home office Totals (5 100 - OP -O- Beginning Inventory Branch $11,550 Shipments from Home Office 115,500 Home Office send merchandise to Branch at a mark up of 8.66% on the billed price. Instructions: 1. Prepare a Schedule of the Flow of Merchandise 2. Prepare de working paper for the business combination 3. Prepare all closing entries for the Branch and the Home Office 4. What is the balance of the Allowance for Overvaluation account? 5. What is the realized gain on the sale of inventory
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