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Herbert, Inc., acquired all of Rambis Company s outstanding stock on January 1 , 2 0 2 0 , for $ 6 4 2 ,
Herbert, Inc., acquired all of Rambis Companys outstanding stock on January for $ in cash. Annual excess amortization of $ results from this transaction. On the date of the takeover, Herbert reported retained earnings of $ and Rambis reported a $ balance. Herbert reported internal net income of $ in and $ in and declared $ in dividends each year. Rambis reported net income of $ in and $ in and declared $ in dividends each year.
a Assume that Herberts internal net income figures above do not include any income from the subsidiary.
If the parent uses the equity method, what is the amount reported as consolidated retained earnings on December
What would be the amount of consolidated retained earnings on December if the parent had applied either the initial value or partial equity method for internal accounting purposes?
b Under each of the following situations, what is the Investment in Rambis account balance on Herberts books on January
The parent uses the equity method.
The parent uses the partial equity method.
The parent uses the initial value method.
c Under each of the following situations, what is Entry C on a consolidation worksheet?
The parent uses the equity method.
The parent uses the partial equity method.
The parent uses the initial value method.
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