Problem 4 3 Perkins Company acquired 100 of Schultz Company on January 1, 2012, for $165,500 On December 31, 2012, the companies prepared the following trial balances Perkins Schultz Cash $26,100 $30,700 Inventory 103,900 93,300 Investment in Schultz Company 219,100 0 Land 114,100 97,400 Cost of Goods Sold 223,600 60,200 Other Expense 40,700 41,400 Dividends Declared 15,200 9,700 Total Debits $742,700 $332,700 Accounts Payable $70,700 $17,000 Common Stock 158,400 77,700 Other Contributed Capital 33,800 17,000 Retained Earnings, 1 1 23,900 56,100 Sales 392,600 164,900 Equity in Subsidiary Income 63,300 0 Total Credits $742,700 $332,700 (b) Prepare a workpaper for the preparation of consolidated financial statements on December 31, 2012 Any difference between the book value of equity acquired and the value implied by the purchase price relates to goodwill (List items that increase retained earnings first )

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Problem 4-3 Perkins Company acquired 100% of Schultz Company on January 1, 2012, for $165,500. On December 31, 2012, the companies prepared the following trial

Problem 4-3

Perkins Company acquired 100% of Schultz Company on January 1, 2012, for $165,500. On December 31, 2012, the companies prepared the following trial balances:

	*Perkins*	*Schultz*
Cash	$26,100	$30,700
Inventory	103,900	93,300
Investment in Schultz Company	219,100	0
Land	114,100	97,400
Cost of Goods Sold	223,600	60,200
Other Expense	40,700	41,400
Dividends Declared	15,200	9,700
Total Debits	$742,700	$332,700

Accounts Payable	$70,700	$17,000
Common Stock	158,400	77,700
Other Contributed Capital	33,800	17,000
Retained Earnings, 1/1	23,900	56,100
Sales	392,600	164,900
Equity in Subsidiary Income	63,300	0
Total Credits	$742,700	$332,700

(b) Prepare a workpaper for the preparation of consolidated financial statements on December 31, 2012. Any difference between the book value of equity acquired and the value implied by the purchase price relates to goodwill. (List items that increase retained earnings first.)