Paper Company acquired 100 percent of Scissor Company's outstanding common stock for $370,000 on January 1, 2008, when the book value of Scissor's net assets was equal to $370,000, including Accumulated Depreciation of $24,000. Problem I summarizes the first year of Paper's ownership of Scissor. The paper uses the equity method to account for investments. Scissor's net income in 2009 was $107,000 and declared dividends of $30,000. The following trial balance summarizes the financial position and operations for Paper & Scissor as of December 31, 2009 Cash 232,000 116000 Accounts Receivable 165,000 97,000 Inventory 193,000 115,000 Paper Company Debit Credit Scissor Company Debit Credit Update T-accounts for the Investment & Income Accounts & Book Value Calculations: Investment in Income From Scissor Scissor Investment in Sdssor Stock $15,000 Land 250,000 125,000 Buildings & Equipment 875,000 250,000 Cost of Goods Sold 278,000 178,000 Depreciation Expense 65,000 12,000 Book Value Calculations: Selling & Administrative Expense 312,000 58,000 Total Dividends Declared 90,000 30,000 Book Common Retained Accumulated Depreciation 630,000 48,000 Value Stock Earnings Accounts Payable 85,000 40,000 Beginning book value Bonds Payable, 150,000 100,000 Common Stock 625,000 250,000 Ending book value Retained Earnings 498,000 188,000 Sales. 880,000 355,000 Income from Scissor 107,000 Total 2,975,000 2,075,000 981,000 981,000