Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

On January 1, 2016, Prange Company acquired 80% of the common stock of Seaman Company for $500,000. On this date Seaman had total owners' equity

image text in transcribed
On January 1, 2016, Prange Company acquired 80% of the common stock of Seaman Company for $500,000. On this date Seaman had total owners' equity of $400,000. Any excess of cost over book value is attributable to patent, which is to be amortized over 20 years. During 2016 and 2017, Prange has appropriately accounted for its investment in Seaman using the simple equity method. On January 1, 2017, Prange held merchandise acquired from Seaman for $30,000. During 2017, Seaman sold merchandise to Prange for $100,000, of which $20,000 is held by Prange on December 31,2017. Seaman's gross profit on all sales is 40%. On December 31, 2017, Prange still owes Seaman $20,000 for merchandise acquired in December. Required: Complete the Figure 4-2 worksheet for consolidated financial statements for the year ended December 31 . 2017. On January 1, 2016, Prange Company acquired 80% of the common stock of Seaman Company for $500,000. On this date Seaman had total owners' equity of $400,000. Any excess of cost over book value is attributable to patent, which is to be amortized over 20 years. During 2016 and 2017, Prange has appropriately accounted for its investment in Seaman using the simple equity method. On January 1, 2017, Prange held merchandise acquired from Seaman for $30,000. During 2017, Seaman sold merchandise to Prange for $100,000, of which $20,000 is held by Prange on December 31,2017. Seaman's gross profit on all sales is 40%. On December 31, 2017, Prange still owes Seaman $20,000 for merchandise acquired in December. Required: Complete the Figure 4-2 worksheet for consolidated financial statements for the year ended December 31 . 2017

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

Loss Control Auditing A Guide For Conducting Fire Safety And Security Audits

Authors: E. Scott Dunlap

1st Edition

1439828865, 978-1439828861

More Books

Students also viewed these Accounting questions

Question

Find (x) for the harmonic-oscillator state with quantum number v.

Answered: 1 week ago

Question

2 What are the key barriers to implementing HRM?

Answered: 1 week ago

Question

1 What are three of the formative traditions in HRM?

Answered: 1 week ago