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Exercise 5-4 On January 1, 2015, Porter Company purchased an 80% interest in Salem Company for $256,900. On this date, Salem Company had common stock
Exercise 5-4
On January 1, 2015, Porter Company purchased an 80% interest in Salem Company for $256,900. On this date, Salem Company had common stock of $210,300 and retained earnings of $128,400. An examination of Salem Companys balance sheet revealed the following comparisons between book and fair values:
Book Value | Fair Value | |||
Inventory | $29,600 | $34,800 | ||
Other current assets | 50,100 | 55,100 | ||
Equipment | 303,400 | 347,200 | ||
Land | 196,800 | 196,800 |
(a)
Determine the amounts that should be allocated to Salem Companys assets on the consolidated financial statements workpaper on January 1, 2015.
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