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P Company purchased 60% of the outstanding common stock of S Company on January 1, 20X3, gaining effective control. A rollforward of S Company's retained
P Company purchased 60% of the outstanding common stock of S Company on January 1, 20X3, gaining effective control. A rollforward of S Company's retained earnings is provided below: 20X3 20X4 20X5 1/1 Balance 400,000 500,000 675,000 Add: Net Income 120,000 200,000 180.000 Less: Dividends (20,000) (25.000) (30,000) 825,000 12/31 Balance 500,000 675,000 The workpaper entry to establish reciprocity under the cost method in the preparation of a consolidated statements workpaper on December 31, 20X5 should include a credit to P Company's retained earnings of
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