QUESTION 4

1. On January 1, 20X8, Potter Corporation acquired 90 percent of Shoemaker Company's voting stock, at underlying book value. The fair value of the noncontrolling interest was equal to 10 percent of the book value of Shoemaker at that date. Potter uses the fully adjusted equity method in accounting for its ownership of Shoemaker. On December 31, 20X9, the trial balances of the two companies are as follows:

   	Potter Company								Shoemaker Corporation
   		Debit			Credit						Debit			Credit
   Current Assets	$	200,000								$	140,000
   Depreciable Assets		350,000									250,000
   Investment in Shoemaker Corp.		162,000
   Depreciation Expense		27,000									10,000
   Other Expenses		95,000									60,000
   Dividends Declared		20,000									10,000
   Accumulated Depreciation				$	118,000								$	80,000
   Current Liabilities					100,000									80,000
   Long-Term Debt					100,000									50,000
   Common Stock					100,000									50,000
   Retained Earnings					150,000									100,000
   Sales					250,000									110,000
   Income from Subsidiary					36,000
   	$	854,000		$	854,000					$	470,000		$	470,000

   Required:

   1. What amount would be reported as total assets in the consolidated balance sheet at December 31, 20X9?

   2. What amount would be reported as total liabilities in the consolidated balance sheet at December 31, 20X9?

   3. What amount would be reported as retained earnings in the consolidated balance sheet prepared at December 31, 20X9?

   4.What amount would be reported as noncontrolling interest in the consolidated balance sheet at December 31, 20X9?

   5. What amount would be reported as total stockholders' equity in the consolidated balance sheet at December 31, 20X9?

   6. What amount would be reported as income to controlling interest in the consolidated financial statements for 20X9?