On December 31, Year 1, Company A purchased 75% of Company Bs outstanding common shares for $150,000 in cash. On that date, the carrying amount of Company Bs assets and liabilities approximated their fair value, and the fair value of the non controlling interest (NCI) was $12,000. The following is the summarized balance sheet information for the two companies on December 31, Year 1, before the acquisition.

Company A Company B Current assets $200,000 $ 80,000

Non current assets 320,000 140,000

Current liabilities 70,000 45,000

Non current liabilities 110,000 55,000

Common stock 100,000 30,000

Retained earnings 90,000 70,000

Additional paid-in capital 150,000 20,000

-Additional information:

-Company B reported net income of $60,000 for the year ended December 31, Year 2. On December 1, Year 2, Company B declared and distributed a cash dividend of $40,000 to its common shareholders.

-On November 15, Year 2, Company A declared and distributed a cash dividend of $25,000 to its common shareholders.

-Company A reported net income of $110,000 in its separate statements for the year ended December 31, Year 2.

-In its separate statements, Company A accounts for its investment in Company B using the equity method.

-During Year 2, no shares of common stock were issued and no items of other comprehensive income were recognized either by Company A or by Company B.

-No intra entity transactions occurred during Year 2.

Use the information above to prepare Company As consolidated statement of changes in equity for the year ended December 31, Year 2. Enter a positive amount for an increase in the consolidated equity balance and a negative amount for a decrease in the consolidated equity balance. Enter the appropriate amounts in the designated cells below. Indicate negative numbers by using a leading minus (-) sign. If no entry is necessary, enter a zero (0) or leave the cell blank.

Company A Consolidated Statement of Changes in Equity for the Year Ended December 31, Year 2 Shareholders' Equity

	Total Equity	Retained Earnings	Common Stock	Additional Paidin Capital	Noncontrolling Interest
1 - 4. January 1, Year 2	$352,000
5 - 8. Dividends	(35,000)
9 - 12. Net income (loss)	125,000
December 31, Year 2	$442,000	$175,000	$100,000	$150,000	$17,000

Use the information above to determine the amount of goodwill or gain from bargain purchase recognized by Company A on the business combination date.

	Amount of Goodwill or Gain
13. Bargain purchase recognized