Patrick Corporation acquired 100 percent of OBrien Companys outstanding common stock on January 1, for $796,500 in cash. OBrien reported net assets with a carrying amount of $448,000 at that time. Some of OBriens assets either were unrecorded (having been internally developed) or had fair values that differed from book values as follows: Book Values Fair Values Trademarks (indefinite life) $ 102,000 $ 299,000 Customer relationships (5-year remaining life) 0 96,600 Equipment (10-year remaining life) 359,000 329,000 Any goodwill is considered to have an indefinite life with no impairment charges during the year. Following are financial statements at the end of the first year for these two companies prepared from their separately maintained accounting systems. OBrien declared and paid dividends in the same period. Credit balances are indicated by parentheses. Patrick O'Brien Revenues $ (1,815,000 ) $ (856,000 ) Cost of goods sold 484,000 396,000 Depreciation expense 104,100 95,400 Amortization expense 28,200 0 Income from O'Brien (348,280 ) 0 Net income $ (1,546,980 ) $ (364,600 ) Retained earnings 1/1 $ (764,000 ) $ (312,000 ) Net income (1,546,980 ) (364,600 ) Dividends declared 154,000 92,000 Retained earnings 12/31 $ (2,156,980 ) $ (584,600 ) Cash $ 238,000 $ 121,000 Receivables 322,000 68,400 Inventory 202,000 168,000 Investment in O'Brien 1,016,780 0 Trademarks 518,000 79,800 Customer relationships 0 0 Equipment (net) 944,000 276,000 Goodwill 0 0 Total assets $ 3,240,780 $ 713,200 Liabilities $ (683,800 ) $ (28,600 ) Common stock (400,000 ) (100,000 ) Retained earnings 12/31 (2,156,980 ) (584,600 ) Total liabilities and equity $ (3,240,780 ) $ (713,200 ) Which investment method did Patrick use to compute the $348,280 income from O'Brien? Determine the totals to be reported for this business combination for the year ending December 31. Verify the totals determined in part (b) by producing a consolidation worksheet for Patrick and OBrien for the year ending December 31. Patrick Corporation acquired 100 percent of OBrien Companys outstanding common stock on January 1, for $796,500 in cash. OBrien reported net assets with a carrying amount of $448,000 at that time. Some of OBriens assets either were unrecorded (having been internally developed) or had fair values that differed from book values as follows: Book Values Fair Values Trademarks (indefinite life) $ 102,000 $ 299,000 Customer relationships (5-year remaining life) 0 96,600 Equipment (10-year remaining life) 359,000 329,000 Any goodwill is considered to have an indefinite life with no impairment charges during the year. Following are financial statements at the end of the first year for these two companies prepared from their separately maintained accounting systems. OBrien declared and paid dividends in the same period. Credit balances are indicated by parentheses. Patrick O'Brien Revenues $ (1,815,000 ) $ (856,000 ) Cost of goods sold 484,000 396,000 Depreciation expense 104,100 95,400 Amortization expense 28,200 0 Income from O'Brien (348,280 ) 0 Net income $ (1,546,980 ) $ (364,600 ) Retained earnings 1/1 $ (764,000 ) $ (312,000 ) Net income (1,546,980 ) (364,600 ) Dividends declared 154,000 92,000 Retained earnings 12/31 $ (2,156,980 ) $ (584,600 ) Cash $ 238,000 $ 121,000 Receivables 322,000 68,400 Inventory 202,000 168,000 Investment in O'Brien 1,016,780 0 Trademarks 518,000 79,800 Customer relationships 0 0 Equipment (net) 944,000 276,000 Goodwill 0 0 Total assets $ 3,240,780 $ 713,200 Liabilities $ (683,800 ) $ (28,600 ) Common stock (400,000 ) (100,000 ) Retained earnings 12/31 (2,156,980 ) (584,600 ) Total liabilities and equity $ (3,240,780 ) $ (713,200 ) Which investment method did Patrick use to compute the $348,280 income from O'Brien? Determine the totals to be reported for this business combination for the year ending December 31. Verify the totals determined in part (b) by producing a consolidation worksheet for Patrick and OBrien for the year ending December 31. Patrick Corporation acquired 100 percent of OBrien Companys outstanding common stock on January 1, for $796,500 in cash. OBrien reported net assets with a carrying amount of $448,000 at that time. Some of OBriens assets either were unrecorded (having been internally developed) or had fair values that differed from book values as follows: Book Values Fair Values Trademarks (indefinite life) $ 102,000 $ 299,000 Customer relationships (5-year remaining life) 0 96,600 Equipment (10-year remaining life) 359,000 329,000 Any goodwill is considered to have an indefinite life with no impairment charges during the year. Following are financial statements at the end of the first year for these two companies prepared from their separately maintained accounting systems. OBrien declared and paid dividends in the same period. Credit balances are indicated by parentheses. Patrick O'Brien Revenues $ (1,815,000 ) $ (856,000 ) Cost of goods sold 484,000 396,000 Depreciation expense 104,100 95,400 Amortization expense 28,200 0 Income from O'Brien (348,280 ) 0 Net income $ (1,546,980 ) $ (364,600 ) Retained earnings 1/1 $ (764,000 ) $ (312,000 ) Net income (1,546,980 ) (364,600 ) Dividends declared 154,000 92,000 Retained earnings 12/31 $ (2,156,980 ) $ (584,600 ) Cash $ 238,000 $ 121,000 Receivables 322,000 68,400 Inventory 202,000 168,000 Investment in O'Brien 1,016,780 0 Trademarks 518,000 79,800 Customer relationships 0 0 Equipment (net) 944,000 276,000 Goodwill 0 0 Total assets $ 3,240,780 $ 713,200 Liabilities $ (683,800 ) $ (28,600 ) Common stock (400,000 ) (100,000 ) Retained earnings 12/31 (2,156,980 ) (584,600 ) Total liabilities and equity $ (3,240,780 ) $ (713,200 ) Which investment method did Patrick use to compute the $348,280 income from O'Brien? Determine the totals to be reported for this business combination for the year ending December 31. Verify the totals determined in part (b) by producing a consolidation worksheet for Patrick and OBrien for the year ending December 31. Patrick Corporation acquired 100 percent of OBrien Companys outstanding common stock on January 1, for $796,500 in cash. OBrien reported net assets with a carrying amount of $448,000 at that time. Some of OBriens assets either were unrecorded (having been internally developed) or had fair values that differed from book values as follows: Book Values Fair Values Trademarks (indefinite life) $ 102,000 $ 299,000 Customer relationships (5-year remaining life) 0 96,600 Equipment (10-year remaining life) 359,000 329,000 Any goodwill is considered to have an indefinite life with no impairment charges during the year. Following are financial statements at the end of the first year for these two companies prepared from their separately maintained accounting systems. OBrien declared and paid dividends in the same period. Credit balances are indicated by parentheses. Patrick O'Brien Revenues $ (1,815,000 ) $ (856,000 ) Cost of goods sold 484,000 396,000 Depreciation expense 104,100 95,400 Amortization expense 28,200 0 Income from O'Brien (348,280 ) 0 Net income $ (1,546,980 ) $ (364,600 ) Retained earnings 1/1 $ (764,000 ) $ (312,000 ) Net income (1,546,980 ) (364,600 ) Dividends declared 154,000 92,000 Retained earnings 12/31 $ (2,156,980 ) $ (584,600 ) Cash $ 238,000 $ 121,000 Receivables 322,000 68,400 Inventory 202,000 168,000 Investment in O'Brien 1,016,780 0 Trademarks 518,000 79,800 Customer relationships 0 0 Equipment (net) 944,000 276,000 Goodwill 0 0 Total assets $ 3,240,780 $ 713,200 Liabilities $ (683,800 ) $ (28,600 ) Common stock (400,000 ) (100,000 ) Retained earnings 12/31 (2,156,980 ) (584,600 ) Total liabilities and equity $ (3,240,780 ) $ (713,200 ) Which investment method did Patrick use to compute the $348,280 income from O'Brien? Determine the totals to be reported for this business combination for the year ending December 31. Verify the totals determined in part (b) by producing a consolidation worksheet for Patrick and OBrien for the year ending December 31. Patrick Corporation acquired 100 percent of OBrien Companys outstanding common stock on January 1, for $796,500 in cash. OBrien reported net assets with a carrying amount of $448,000 at that time. Some of OBriens assets either were unrecorded (having been internally developed) or had fair values that differed from book values as follows: Book Values Fair Values Trademarks (indefinite life) $ 102,000 $ 299,000 Customer relationships (5-year remaining life) 0 96,600 Equipment (10-year remaining life) 359,000 329,000 Any goodwill is considered to have an indefinite life with no impairment charges during the year. Following are financial statements at the end of the first year for these two companies prepared from their separately maintained accounting systems. OBrien declared and paid dividends in the same period. Credit balances are indicated by parentheses. Patrick O'Brien Revenues $ (1,815,000 ) $ (856,000 ) Cost of goods sold 484,000 396,000 Depreciation expense 104,100 95,400 Amortization expense 28,200 0 Income from O'Brien (348,280 ) 0 Net income $ (1,546,980 ) $ (364,600 ) Retained earnings 1/1 $ (764,000 ) $ (312,000 ) Net income (1,546,980 ) (364,600 ) Dividends declared 154,000 92,000 Retained earnings 12/31 $ (2,156,980 ) $ (584,600 ) Cash $ 238,000 $ 121,000 Receivables 322,000 68,400 Inventory 202,000 168,000 Investment in O'Brien 1,016,780 0 Trademarks 518,000 79,800 Customer relationships 0 0 Equipment (net) 944,000 276,000 Goodwill 0 0 Total assets $ 3,240,780 $ 713,200 Liabilities $ (683,800 ) $ (28,600 ) Common stock (400,000 ) (100,000 ) Retained earnings 12/31 (2,156,980 ) (584,600 ) Total liabilities and equity $ (3,240,780 ) $ (713,200 ) Which investment method did Patrick use to compute the $348,280 income from O'Brien? Determine the totals to be reported for this business combination for the year ending December 31. Verify the totals determined in part (b) by producing a consolidation worksheet for Patrick and OBrien for the year ending December 31.