Problem 5-29

ProForm acquired 60 percent of ClipRite on June 30, 2017, for $840,000 in cash. Based on ClipRite's acquisition-date fair value, an unrecorded intangible of $700,000 was recognized and is being amortized at the rate of $12,000 per year. No goodwill was recognized in the acquisition. The noncontrolling interest fair value was assessed at $560,000 at the acquisition date. The 2018 financial statements are as follows:

		ProForm				ClipRite
Sales	$	(960,000	)		$	(920,000	)
Cost of goods sold		615,000				480,000
Operating expenses		260,000				180,000
Dividend income		(48,000	)			0
Net income	$	(133,000	)		$	(260,000	)
Retained earnings, 1/1/18	$	(2,000,000	)		$	(1,010,000	)
Net income		(133,000	)			(260,000	)
Dividends declared		260,000				80,000
Retained earnings, 12/31/18	$	(1,873,000	)		$	(1,190,000	)
Cash and receivables	$	560,000			$	460,000
Inventory		450,000				860,000
Investment in ClipRite		840,000				0
Fixed assets		1,300,000				1,400,000
Accumulated depreciation		(200,000	)			(350,000	)
Totals	$	2,950,000			$	2,370,000
Liabilities	$	(777,000	)		$	(880,000	)
Common stock		(300,000	)			(300,000	)
Retained earnings, 12/31/18		(1,873,000	)			(1,190,000	)
Totals	$	(2,950,000	)		$	(2,370,000	)

ClipRite sold ProForm inventory costing $85,000 during the last six months of 2017 for $250,000. At year-end, 30 percent remained. ClipRite sells ProForm inventory costing $280,000 during 2018 for $410,000. At year-end, 10 percent is left. With these facts, determine the consolidated balances for the following:

Consolidated Balance Sales Cost of goods sold Operating expenses Dividend income Net income attibutable to noncontrolling interest Inventory Noncontrolling interest in subsidiary, 12/31/18