Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Parent Co. purchases 80 percent of Son Company on January 1, 20X1, when Parents retained earnings balance is $550,000 and Sons is $200,000. During 20X1,
Parent Co. purchases 80 percent of Son Company on January 1, 20X1, when Parents retained earnings balance is $550,000 and Sons is $200,000. During 20X1, Son reports $20,000 of net income and declares $6,000 of dividends. Parent reports $125,000 of separate operating earnings plus $16,000 of equity-method income from its 80 percent interest in Son; Parent declares dividends of $40,000. Based on the preceding information, what is Consolidated retained earnings balance on December 31, 20X1?
Group of answer choices
$635,000
$550,000
$544,000
$651,000
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started