Question
On January 1, Year 5, Pic Company acquired 7,500 ordinary shares of Sic Company for $717,000. On January 1, Year 6, Pic Company acquired
On January 1, Year 5, Pic Company acquired 7,500 ordinary shares of Sic Company for $717,000. On January 1, Year 6, Pic Company acquired an additional 2,000 ordinary shares of Sic Company for $210,000. On January 1, Year 5, the shareholders' equity of Sic was as follows: Ordinary shares (10,000 no par value shares issued) Retained earnings $200,000 330,000 $530,000 The following are the statements of retained earnings for the two companies for Years 5 and 6: Pic Sic Year 5 Retained earnings, beginning of year $ 542,000 Profit Dividends 151,000 (100,000) Retained earnings, end of year $ 593,000 Year 6 $ 593,000 162,000 (120,000) $ 635,000 Year 5 $330,000 Year 6 $353,000 113,000 148,000 (90,000) (90,000) $353,000 $411,000 Additional Information . Pic uses the cost method to account for its investment in Sic. . Any acquisition differential is allocated to customer contracts, which are expected to provide future benefits until December 31, Year 7. Neither company has any customer contracts recorded on their separate-entity records. There were no unrealized profits from intercompany transactions since the date of acquisition. Required: (a) Calculate consolidated profit attributable to Pic's shareholders for Year 6. (Omit $ sign in your response.) Consolidated profit attributable to Pic's shareholders
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