iew the Retained Earnings Statement (below) and explain why dividend declared for Sesnor Co. is n the consolidated balance Parent Subsidiary Plexi Co.Sesnor Co. Debit Credit Balance Retained Earnings 1/1 Beg. Of Current Year $ 3,960,500 110,500 (0) Plexi Co. Sesnor Co. $ 3,850,000 5 3,200000 3,20,00 ( 140,250 s 1,314,750 $ 450,000 S323,000 102,750 $ 4825,250 Net Income from above 935,000 Divident Declared Plexi Co. Sesnor Co. 450,000 s 212,500 (a 37,500 s 250,000 Retained Earnings 12/31 End of Current Year $ 4132,500 $ 3885,0003,412,500 Complete the balance sheet. Parent Subsidiaryorkeaper (B PiexiCaSenCo Elimination) Entries Consolidated Debit rscditNCBalance Assets Cash Accounts Receivable Inventory12/31 Investment in Sub Sesnor Co. Net Plant Assets $450,000 $750,000 $ 875,000 950,000 S5,700,000 $3,850,000$3,450,000 260,000 $ 450,000 250,000 $ 1,000,000 Other Assets $150,000 Difference Total Assets 12,025,000 $ 360,000 Liabilities Accounts Payable Other Uabilities $4,244,500 $ 1,150,000 $998000 S325,000 $5,242,500 1,475,000 Total Liabilities Equity Common Stock S 250,000 Plexi Co. Sesnor Co. 10000 APIC 2,400,000 s Plexi Co. Sesnor Co. $ 900,000 $ 4,132,500$ 3,885,000 Retained Earnings from above 1/1 Noncontrolling Interest 12/31 Noncontrolling Interest Total Equity 6,782,500 S 4,885,000 Total Liabilities and Equity $ 12,025,000 $ 6,360,000 1, m for ss,mom Plexi Company purchased 8 % of the outstanding common stock of SesnorCompany on January NOTE: COST METHOD USED BY PARENT Debit dit Jan. 1, 2009 Investment in Subsidiary-Sesnor 5,700,000 The Sesnor Company balancesheet on 1/1/09 and 12/31/12 are as follows: FairValue Assets Cash Accounts Receivable nventory Net Plant Assets 120,000 $ 260,000 350,000 $ 450,000 1,275,000 950,000 3,200,000 3,450,000 1,000,000 $ 1,000,000 250,000 $120,000 $350,000 $1,275,000 $ 3,200,000 $ 2,500,000 $ 1,500,000 Other Assets Total Assets 5,945,000 Accounts Payable Other Uabilities 1,375,000 $ 1,150,000 500,000 $325,000 s -875,000 s 1.475.00 1,375,000 $ Ts0,000 $ 250,000 Total Uabilities 100,000 $ 100,000 900,000 $ 900,000 3,070.000$ 3,885,000 Common Stock (Par S1) Retained Eamings s Total Equity Total iabilities &EquityS 100% 15% NCI 85%) Ownership 85% Impli Fair Value Given Up Book Value Received $ 5,700,000 $ 1,005,882 $ 3,459,500 610,500 395,382 6,705,882 4,070,000 2,635,882 2,240,500 $ Difference Land Other Liabilities 1,275,000 225,000 1,500,000 S 212,50037,500 $ 250,000 $1,385,882 1,385,882 $1,178,000 $ 207,882 1,178,000 207,882 Goodwill Balance 250,000212,500 During 2012, Sesnor Company declared dividends in the amount of During 2012, Sesnor Company had net income in the amount of $935,000 Sesnor Company Retained Earnings as of 12/31/2011 was 3,200,000 PREPARE THE WORKPAPER (and related workpaper entries)THAT WOULD BE MADE IN THE PREPARATION OF THE CONSOUDATED FINANCIAL STATEMENTS ON DECEMBER 31, 2012 the following workpaper entries are made Cost Method - After Year of Acquisition en Deb Credit Investment in Subsidiary-Sesnor Company 110,500 Retained Earnings 1/1Current Year- Parent $ 110,500 e spa What does the following entry accomplish in the workpaper? Credit $ 212,500 $212,500 Dividend Income Dividend Declared-Sub-Sesnor Co. Review the entry below. Workpaper Entry (2) Common Stock-Sesnor Co. APIC-Sesnor Co. Retained Earnings-Sesnor Co. Difference Debit 100,000 $900,000 $3,200,000 $ 2,635,882 Investment in Subsidiary- Sesnor Company NCI $ 5,810,500 $1,025,382 Show how the credit to investment in Subsidiary and NCI (above) is calculated in the space provided 12 low Complete the entry to allocate the difference below. Debit Plexi Co. and Subsidiary For the Year Ended December 31, 2012 Parent Subsidiary Debit $ 9,500,000 5,500,000 $ 212,500 $ $ 9,712,500 $ 5,500,000 15,000,000 212,500 (1) Dividend Income $15,000,000 Total Revenue COGS: $ 7s0,00D $850,000 100,000 $ 8,850,000 $ 4950,000 875,000 950.000 $ 7,975,000 4,000,000 1,600,000 12,200,000 $13,800,000 inventory 1/1 $ 8100,000 Available for Sale Inventory 12/31 Cost of Goods Sold 11,975,000 $ 715,000 S 855,000 $13,545,000 s 1,455,000 140 250 $ 10.20 s 140,250 $ 1314.750 $425,000$ Selling Expense Other Expenses 5 $80,000 $ 275000 $ 8980 000 $ 4565,000 Total Expenses Net income to Retained Earnings 732500 5 935,0 000 212,500 5 Demanstrate (below) 50 in iew the Retained Earnings Statement (below) and explain why dividend declared for Sesnor Co. is n the consolidated balance Parent Subsidiary Plexi Co.Sesnor Co. Debit Credit Balance Retained Earnings 1/1 Beg. Of Current Year $ 3,960,500 110,500 (0) Plexi Co. Sesnor Co. $ 3,850,000 5 3,200000 3,20,00 ( 140,250 s 1,314,750 $ 450,000 S323,000 102,750 $ 4825,250 Net Income from above 935,000 Divident Declared Plexi Co. Sesnor Co. 450,000 s 212,500 (a 37,500 s 250,000 Retained Earnings 12/31 End of Current Year $ 4132,500 $ 3885,0003,412,500 Complete the balance sheet. Parent Subsidiaryorkeaper (B PiexiCaSenCo Elimination) Entries Consolidated Debit rscditNCBalance Assets Cash Accounts Receivable Inventory12/31 Investment in Sub Sesnor Co. Net Plant Assets $450,000 $750,000 $ 875,000 950,000 S5,700,000 $3,850,000$3,450,000 260,000 $ 450,000 250,000 $ 1,000,000 Other Assets $150,000 Difference Total Assets 12,025,000 $ 360,000 Liabilities Accounts Payable Other Uabilities $4,244,500 $ 1,150,000 $998000 S325,000 $5,242,500 1,475,000 Total Liabilities Equity Common Stock S 250,000 Plexi Co. Sesnor Co. 10000 APIC 2,400,000 s Plexi Co. Sesnor Co. $ 900,000 $ 4,132,500$ 3,885,000 Retained Earnings from above 1/1 Noncontrolling Interest 12/31 Noncontrolling Interest Total Equity 6,782,500 S 4,885,000 Total Liabilities and Equity $ 12,025,000 $ 6,360,000 1, m for ss,mom Plexi Company purchased 8 % of the outstanding common stock of SesnorCompany on January NOTE: COST METHOD USED BY PARENT Debit dit Jan. 1, 2009 Investment in Subsidiary-Sesnor 5,700,000 The Sesnor Company balancesheet on 1/1/09 and 12/31/12 are as follows: FairValue Assets Cash Accounts Receivable nventory Net Plant Assets 120,000 $ 260,000 350,000 $ 450,000 1,275,000 950,000 3,200,000 3,450,000 1,000,000 $ 1,000,000 250,000 $120,000 $350,000 $1,275,000 $ 3,200,000 $ 2,500,000 $ 1,500,000 Other Assets Total Assets 5,945,000 Accounts Payable Other Uabilities 1,375,000 $ 1,150,000 500,000 $325,000 s -875,000 s 1.475.00 1,375,000 $ Ts0,000 $ 250,000 Total Uabilities 100,000 $ 100,000 900,000 $ 900,000 3,070.000$ 3,885,000 Common Stock (Par S1) Retained Eamings s Total Equity Total iabilities &EquityS 100% 15% NCI 85%) Ownership 85% Impli Fair Value Given Up Book Value Received $ 5,700,000 $ 1,005,882 $ 3,459,500 610,500 395,382 6,705,882 4,070,000 2,635,882 2,240,500 $ Difference Land Other Liabilities 1,275,000 225,000 1,500,000 S 212,50037,500 $ 250,000 $1,385,882 1,385,882 $1,178,000 $ 207,882 1,178,000 207,882 Goodwill Balance 250,000212,500 During 2012, Sesnor Company declared dividends in the amount of During 2012, Sesnor Company had net income in the amount of $935,000 Sesnor Company Retained Earnings as of 12/31/2011 was 3,200,000 PREPARE THE WORKPAPER (and related workpaper entries)THAT WOULD BE MADE IN THE PREPARATION OF THE CONSOUDATED FINANCIAL STATEMENTS ON DECEMBER 31, 2012 the following workpaper entries are made Cost Method - After Year of Acquisition en Deb Credit Investment in Subsidiary-Sesnor Company 110,500 Retained Earnings 1/1Current Year- Parent $ 110,500 e spa What does the following entry accomplish in the workpaper? Credit $ 212,500 $212,500 Dividend Income Dividend Declared-Sub-Sesnor Co. Review the entry below. Workpaper Entry (2) Common Stock-Sesnor Co. APIC-Sesnor Co. Retained Earnings-Sesnor Co. Difference Debit 100,000 $900,000 $3,200,000 $ 2,635,882 Investment in Subsidiary- Sesnor Company NCI $ 5,810,500 $1,025,382 Show how the credit to investment in Subsidiary and NCI (above) is calculated in the space provided 12 low Complete the entry to allocate the difference below. Debit Plexi Co. and Subsidiary For the Year Ended December 31, 2012 Parent Subsidiary Debit $ 9,500,000 5,500,000 $ 212,500 $ $ 9,712,500 $ 5,500,000 15,000,000 212,500 (1) Dividend Income $15,000,000 Total Revenue COGS: $ 7s0,00D $850,000 100,000 $ 8,850,000 $ 4950,000 875,000 950.000 $ 7,975,000 4,000,000 1,600,000 12,200,000 $13,800,000 inventory 1/1 $ 8100,000 Available for Sale Inventory 12/31 Cost of Goods Sold 11,975,000 $ 715,000 S 855,000 $13,545,000 s 1,455,000 140 250 $ 10.20 s 140,250 $ 1314.750 $425,000$ Selling Expense Other Expenses 5 $80,000 $ 275000 $ 8980 000 $ 4565,000 Total Expenses Net income to Retained Earnings 732500 5 935,0 000 212,500 5 Demanstrate (below) 50 in