Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Following are selected accounts for Green Corporation and Vega Company as of December 31, 2023. Several of Green's accounts have been omitted. Green Vega Revenues

Following are selected accounts for Green Corporation and Vega Company as of December 31, 2023. Several of Green's accounts have been omitted.

Green Vega

Revenues $ 900,000 $ 500,000

Cost of goods sold 360,000 200,000

Depreciation expense 140,000 40,000

Other expenses 100,000 60,000

Equity in Vegas income ?

Retained earnings, 1/1/2023 1,350,000 1,200,000

Dividends 195,000 80,000

Current assets 300,000 1,380,000

Land 450,000 180,000

Building (net) 750,000 280,000

Equipment (net) 300,000 500,000

Liabilities 600,000 620,000

Common stock 450,000 80,000

Additional paid-in capital 75,000 320,000

Green acquired 100% of Vega on January 1, 2019, by issuing 10,500 shares of its $10 par value common stock with a fair value of $95 per share. On January 1, 2019, Vega's land was undervalued by $40,000, its buildings were overvalued by $30,000, and equipment was undervalued by $80,000. The buildings have a 20-year life and the equipment has a 10-year life. $50,000 was attributed to an unrecorded trademark with a 16-year remaining life. There was no goodwill associated with this investment.

Assuming Green uses equity method, compute the December 31, 2023 consolidated retained earnings.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Studies Of Company Records (RLE Accounting)1830-1974

Authors: J. R. Edwards

1st Edition

1138983306, 9781138983304

More Books

Students also viewed these Accounting questions

Question

Why must in-service training or on-the-job education be continuing?

Answered: 1 week ago