Foxx Corporation acquired all of Greenburg Companys outstanding stock on January 1, 2019, for $911,000 cash. Greenburgs accounting records showed net assets on that date of $688,000, although equipment with a 10-year remaining life was undervalued on the records by $175,000. Any recognized goodwill is considered to have an indefinite life. Greenburg reports net income in 2019 of $105,500 and $113,000 in 2020. The subsidiary declared dividends of $20,000 in each of these two years. Account balances for the year ending December 31, 2021, follow. Credit balances are indicated by parentheses. Foxx Greenburg Revenues $ (1,136,000 ) $ (840,000 ) Cost of goods sold 142,000 210,000 Depreciation expense 338,000 383,000 Investment income (20,000 ) 0 Net income $ (676,000 ) $ (247,000 ) Retained earnings, 1/1/21 $ (1,214,000 ) $ (566,500 ) Net income (676,000 ) (247,000 ) Dividends declared 120,000 20,000 Retained earnings, 12/31/21 $ (1,770,000 ) $ (793,500 ) Current assets $ 309,000 $ 188,000 Investment in subsidiary 911,000 0 Equipment (net) 910,000 726,000 Buildings (net) 998,000 588,000 Land 696,000 144,000 Total assets $ 3,824,000 $ 1,646,000 Liabilities $ (1,154,000 ) $ (552,500 ) Common stock (900,000 ) (300,000 ) Retained earnings (1,770,000 ) (793,500 ) Total liabilities and equity $ (3,824,000 ) $ (1,646,000 ) Determine the December 31, 2021, consolidated balance for each of the following accounts: Depreciation Expense Buildings Dividends Declared Goodwill Revenues Common Stock Equipment How does the parent's choice of an accounting method for its investment affect the balances computed in requirement (a)? Which method of accounting for this subsidiary is the parent actually using for internal reporting purposes? Determine parent's investment income for 2021 under partial equity method and equity method. What would be Foxxs balance for retained earnings as of January 1, 2021, if each of the following methods had been in use? Initial value method. Partial equity method. Equity method.

• Req A
• Req B and C
• Req D and E

Determine the December 31, 2021, consolidated balance for each of the following accounts: (Input all amount as positive values.)

	Consolidated Balances
Depreciation expense
Dividends declared
Revenues
Equipment
Buildings
Goodwill
Common stock

• Req B and C
• Req D and E

b. How does the parent's choice of an accounting method for its investment affect the balances computed in requirement (a)?

c. Which method of accounting for this subsidiary is the parent actually using for internal reporting purposes?

b.	It affects the consolidated totalsradio button unchecked1 of 3
	It affects the internal reporting of the parent, but not the consolidated totalsradio button unchecked2 of 3
	It doesn't have any affectradio button unchecked3 of 3
c.	Initial value methodradio button unchecked1 of 3
	Partial equity methodradio button unchecked2 of 3
	Equity methodradio button unchecked3 of 3

d. Determine parent's investment income for 2021 under partial equity method and equity method.

e. What would be Foxxs balance for retained earnings as of January 1, 2021, if each of the following methods had been in use?

	d. Investment Income	e. Retained Earnings
Initial value method
Partial equity method
Equity method