CTIVE SCORE STRUCTOR USE ONLY Acctg501 F16 Advanced Financial Accounting SDSU Use the following information to answer questions 12-17 below: On January 1, 2011, Pride, Inc. acquired 80% of the outstanding voting common stock of Strons Corp. for $364,000. There is no active market for Strong's stock of this payment, $28,000 was allocated to equipment (with a five-year life) that had been undervalued on Strong's books by $35,000. Any remaining excess was attributable to goodwill which has not been impaired. As of December 31, 2011, before preparing the consolidated worksheet, the financial statements appeared as follows: Revenues Cost of goods sold Pride Inc. Strong Corp. $420,000 $280,000 (196,000) (112,000) Operating expenses (28,000) (14,000) Net income $196,000 $154,000 Retained earning, 1/1/15 $420,000 $210,000 Net Income 196,000 154,000 Dividend paid Retained earnings, 12/31/15 $616,000 $364,000 Cash and receivables $294,000 $126,000 Inventory 210,000 154,000 Investment in Strong Corp 364,000 Equipment (net) 616,000 420,000 Total assets $1,484,000 $700,000 Liabilities Common stock Retained earnings, 12/31/15 $588,000 $196,000 280,000 140,000 616,000 364,000 Total liabilities and stockholders' equity $1,484,000 $700,000 During 2011, Pride bought inventory for $112,000 and sold it to Strong for $140,000. Only half of this purchase had been paid for by Strong by the end of the year. 60% of these goods were still in the company's possession on December 31. ONL COR