Answered step by step
Verified Expert Solution
Question
...
1 Approved Answer
Exercise 1 (10 points): On January 1, 2011, Lapwing Corporation purchased 70% of the common stock of Forage Corporation for $320,000 when Forage had Common
Exercise 1 (10 points): On January 1, 2011, Lapwing Corporation purchased 70% of the common stock of Forage Corporation for $320,000 when Forage had Common Stock outstanding of $100,000 and Retained Earnings of $200,000. Any excess differential was attributed to goodwill. At the end of 2011, Lapwing and Forage had unrealized inventory profits in their ending inventories left from intercompany sales of $6,000 and $8,000, respectively. These year-end profit amounts were realized in 2012. At the end of 2012 Lapwing held inventory acquired from Forage with a $10,000 unrealized profit. Lapwing reported separate income of $100,000 for 2012 and paid dividends of $30,000. Forage reported separate income of $70,000 for 2012 and paid dividends of $20,000 Required Compute the amount of consolidated net income for 2012
![image text in transcribed](https://s3.amazonaws.com/si.experts.images/answers/2024/07/669b9c0853d69_055669b9c07e1ec4.jpg)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-text-image.webp)
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-subtext-image.webp)
Step: 3
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-subtext-image.webp)
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started