Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Carson, Inc., acquires 80 percent of the outstaniding common stock of Gardena corporation on January 1, 2020, in exchange for $900,000 cash. At the acquisition
Carson, Inc., acquires 80 percent of the outstaniding common stock of Gardena corporation on January 1, 2020, in exchange for $900,000 cash. At the acquisition date, Gardena's total fair value, including the noncontrolling interest, was assessed at $1,125,000. Also at the acquisition date, Gardena's book value was $690,000. Several individual items on Gardena's financial records had fair values that differed from their book values as follows:
Book value | Fair value | |||||||||
Trademark (indefinite life) | $360,000 | $383,000 | ||||||||
Property and equipment (net, 8-year remaining useful life) | 290,000 | 330,000 | ||||||||
Patent (14-year remaining useful life) | 132,000 | 272,000 |
For internal reporting purposes, Carson, inc., employs the equity method to account for this investment. The following account balances are for the year | |||||||||||
ending December 31, 2020, for both companies. At year-end, there were no intra-entity receivables or payables. |
questions:
6. What is the consolidated balance for investment at December 31, 2020? | ||||||||
Your answer: | ||||||||
7. What is the consolidated balance for equity in income of Gardena at December 31, 2020? | ||||||||
Your answer: | ||||||||
8. What is the consolidated balance for dividend declared at December 31, 2020? | ||||||||
Your answer: | ||||||||
9. What is the net income attributable to noncontrolling interests of Gardena at December 31, 2020? | ||||||||
Your answer: | ||||||||
10. What is the net income attributable to controlling interests of Gardena at December 31, 2020? | ||||||||
Your answer: |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started