Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Pie Corporation acquired 80 percent of Slice Company's common stock on December 31, 20X5, at underlying book value. The book values and fair values of
Pie Corporation acquired 80 percent of Slice Company's common stock on December 31, 20X5, at underlying book value. The book values and fair values of Slice's assets and liabilities were equal, and the fair value of the noncontrolling interest was equal to 20 percent of the total book value of Slice. Slice provided the following trial balance data at December 31, 20x5: Credit Cash Accounts Receivable Inventory Buildings and Equipment (net) Cost of Goods Sold Depreciation Expense Other Operating Expenses Dividends Declared Accounts Payable Notes Payable Common Stock Retained Earnings Sales Total Debit $ 27,200 65,350 90,800 205,000 103,600 24,250 31,340 15,900 $ 33,680 119,000 95,400 126,500 188,860 $563,440 5563, 440 Required: a. How much did Ple pay to purchase its shares of Slice? (Round your answer to nearest whole dolar amount.) Purchase price b. If consolidated financial statements are prepared at December 31, 20x5, what amount will be assigned to the noncontrolling interest in the consolidated balance sheet? (Round your answer to nearest whole dollar amount.) Noncontrolling interest c. If Ple reported income of $144,750 from its separate operations for 20x5, what amount of consolidated net income will be reported for 20X5? Consolidated not income d. If Pie had purchased its ownership of Slice on January 1, 20X5, at underlying book value and Ple reported income of $144,750 from its separate operations for 20x5, what amount of consolidated net income would be reported for 20X5? Consolidated not income
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