Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Following are the individual financial statements for Gibson and Davis for the year ending December 31, 2018 Gibson Davis Sales Cost of goods sold Operating

image text in transcribedimage text in transcribedimage text in transcribed

Following are the individual financial statements for Gibson and Davis for the year ending December 31, 2018 Gibson Davis Sales Cost of goods sold Operating expenses Dividend income (821,000 422,000) 211,000 66,000 382,000 262,000 (24,000 (201,000) (145,000) Net income Retained earnings, 1/1/18 Net income Dividends declared (774,000) (485,000) (145,000) (201,000) 50,000 40,000 (925,000) (590,000) Retained earnings, 12/31/18 Cash and receivables Inventory Investment in Davis Buildings (net) Equipment (net) 258, 650171,000 235,000 540,000 595,350 547,000 444, 000 2,385,000 661,000 432,000 1,499,000 Total assets Liabilities Common stock Retained earnings, 12/31/18 (830,000) (569,000) (340,000) (925,000)(590,000) (630,000) Total liabilities and $ (2,385,000) (1,499,000) stockholders' equity Gibson acquired 60 percent of Davis on April 1, 2018, for $595,350. On that date, equipment owned by Davis (with a five-year remaining life) was overvalued by $39,000. Also on that date, the fair value of the 40 percent noncontrolling interest was $396,900 Davis earned income evenly during the year but declared the $40,000 dividend on November 1, 2018 a. Prepare a consolidated income statement for the year ending December 31, 2018 b. Determine the consolidated balance for each of the following accounts as of December 31, 2018 Dividends declared Complete this question by entering your answers in the tabs below Required ARequired B Determine the consolidated balance for each of the following accounts as of December 31, 2018: Goodwill Equipment (net) Common stock Buildings (net) Dividends declared Goodwill Equipment (net) Common stock Buildings (net) Dividends declared Complete this question by entering your answers in the tabs below Required A Required B Prepare a consolidated income statement for the year ending December 31, 2018. (Enter all amounts as positive values.) Consolidated Income Statement For the Year Ending December 31, 2018

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

Automotive Audits Principles And Practices

Authors: D. H. Stamatis

1st Edition

0367696592, 978-0367696597

More Books

Students also viewed these Accounting questions

Question

Why We Listen?

Answered: 1 week ago