Financial statements of Par Corp. and its subsidiary Star Inc. on December 31, Year 12, are shown below: Other Information - On January 1, Year 5, the balance sheet of Star showed the following shareholders' equity: (b) How would the retum on equty attributabie to Par's shareholders for Vear 12 change it Star's preferned shares were non-cumulative inslead of cumulative? No Change Change (c) On January 1, Yesr 13, 5 tar issued common shares for 5100,000 in cash. Becouse Par did not purchase any of these shares, Pars ownership pericentage declined from 70 to 56K. Calculate the gain or loss that would be charged er credined to consolidated shareholsers' equly as a cesult of this transaction (input all ameunts as pesitive values. Round imermediate calculations and finat answer to nearest dolfar ameunt, Omit 5 sign in your respromses Tnveatary of Par - The December 31, Year 12, inventories of the two companies contained unrealized intercompany profits as follows: - On July 1, Year 7, Star sold equipment to Par for $62,000. The equipment had a carrying amount in the records of $ tar of $42,000 on this date and an estimated remaining useful life of five years. - Goodwill impaiment losses were recorded as follows: Year 7, \$76,000; Year 9, \$47,370; and Year 12, \$19.860. - Assume a 40% corporate tax rate. - Por has accounted for its investment in Star by the cost method. - All dividends in arrears were poid by Dencember 31, Year 11. Required: (a) Prepare, with all necessary calculations, the following: (i) Year 12 consolidated retained earnings statement. (input all amounts as positive values. Omit $ sign in your response.) Par Corp. Consolidated lotained Earnings statenat. Tear Knded Deceaber, 31 , Teax 12 Balance Jabuary I bet lose Dividendi falance December 31 - On January 1, Year 5, the balance sheet of Star showed the following shareholders' equity: Note 1: Dividends on preferred shares are two years in arrears. On this date, Par acquired 1,400 common shares of Star for a cash payment of $212,800. The fair values of Star's identifiable net assets differed from carrying amounts only with respect to the fllowing: The plant had an estimated remaining useful life of five years on this date, and the long-term liabilities had a maturity date of December 30, Year 12. Any goodwill is to be tested annually for impairment. - Both Par and Star make substantial sales to each other at an intercompany selling price that yields the same gross profit as the they make to unrelated customers. Intercompany sales in Year 12 were as follows: - During Year 12, Par billed Star $2,000 per month in management fees. At year-end, Star had paid for all months except for December. - The January 1, Year 12, inventories of the two companies contained unrealized intercompany profits as follows: (ii) Consolidated balance sheet as at December 31, Year 12. \begin{tabular}{|l|l|} \hline \multicolumn{2}{|c|}{ Par Corp. } \\ \hline Consolidated Balance Sheet \\ \hline ass at December 31, Yoar 12 \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline \end{tabular} (b) How would the return on equity attributable to Par's Financial statements of Par Corp. and its subsidiary Star Inc. on December 31, Year 12, are shown below: Other Information - On January 1, Year 5, the balance sheet of Star showed the following shareholders' equity: (b) How would the retum on equty attributabie to Par's shareholders for Vear 12 change it Star's preferned shares were non-cumulative inslead of cumulative? No Change Change (c) On January 1, Yesr 13, 5 tar issued common shares for 5100,000 in cash. Becouse Par did not purchase any of these shares, Pars ownership pericentage declined from 70 to 56K. Calculate the gain or loss that would be charged er credined to consolidated shareholsers' equly as a cesult of this transaction (input all ameunts as pesitive values. Round imermediate calculations and finat answer to nearest dolfar ameunt, Omit 5 sign in your respromses Tnveatary of Par - The December 31, Year 12, inventories of the two companies contained unrealized intercompany profits as follows: - On July 1, Year 7, Star sold equipment to Par for $62,000. The equipment had a carrying amount in the records of $ tar of $42,000 on this date and an estimated remaining useful life of five years. - Goodwill impaiment losses were recorded as follows: Year 7, \$76,000; Year 9, \$47,370; and Year 12, \$19.860. - Assume a 40% corporate tax rate. - Por has accounted for its investment in Star by the cost method. - All dividends in arrears were poid by Dencember 31, Year 11. Required: (a) Prepare, with all necessary calculations, the following: (i) Year 12 consolidated retained earnings statement. (input all amounts as positive values. Omit $ sign in your response.) Par Corp. Consolidated lotained Earnings statenat. Tear Knded Deceaber, 31 , Teax 12 Balance Jabuary I bet lose Dividendi falance December 31 - On January 1, Year 5, the balance sheet of Star showed the following shareholders' equity: Note 1: Dividends on preferred shares are two years in arrears. On this date, Par acquired 1,400 common shares of Star for a cash payment of $212,800. The fair values of Star's identifiable net assets differed from carrying amounts only with respect to the fllowing: The plant had an estimated remaining useful life of five years on this date, and the long-term liabilities had a maturity date of December 30, Year 12. Any goodwill is to be tested annually for impairment. - Both Par and Star make substantial sales to each other at an intercompany selling price that yields the same gross profit as the they make to unrelated customers. Intercompany sales in Year 12 were as follows: - During Year 12, Par billed Star $2,000 per month in management fees. At year-end, Star had paid for all months except for December. - The January 1, Year 12, inventories of the two companies contained unrealized intercompany profits as follows: (ii) Consolidated balance sheet as at December 31, Year 12. \begin{tabular}{|l|l|} \hline \multicolumn{2}{|c|}{ Par Corp. } \\ \hline Consolidated Balance Sheet \\ \hline ass at December 31, Yoar 12 \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline \end{tabular} (b) How would the return on equity attributable to Par's