Situation B

At January 1, 2021: Paris Company paid $280,000 for a 80% interest in Shallby Company.

In this moment Shallby's Stockholders' Equity consisted:

SITUATIONC SITUATION D SITUATION E SITUATION A SITUATION B Cont SITUATION Situation B At January 1, 2021: Paris Company paid $280,000 for a 80% interest in Shallby Company In this moment Shallby's Stockholders' Equity consisted: Capital Stock $150,000 Retained Eamings $50,000 Book values of Shallby's net assets were equal to their fair value on this date The following will be presented the accounts of Paris Company and Shallby Company as December 31, 2021 (balance of the adjusting trial balance): Paris Shallby 58.250 $35.000 8.000 40.000 50.000 50.000 30.000 100.000 150,000 Accounts Cash Dividend Receivables Accounts Receivables Land Property. Plant and Equipment Investment in Shallby Accounts Payable Dividend Payable Capital Sock Retained amnings (Beg) Dividend Sales Reyonues Cost of Goods Sold Operatin Expenses Present the Income Statement and the Retained Earnings Statement Paris Company Income Statement For the year ended December 31, 2021 Sales Revenues $400,000 Less: Co of Goods Sold (225.000) Gross Profit $175,000 Less: Operating Expenses (45.0000) Net Income $120.000 40,750 150,000 206 500 25.000 400,000 225.000 45.000 35.000 10,000 150.000 50,000 20.000 190.000 125.000 25.000 Paris Company Retained Earnings Statement For the year ended December 31, 2021 Retained Earnings. Beginning (Jan. 1.2020) Plus: Net Income S206.500 120.000 $336,500 C25.000) $311.500 Less Dividends Declared Retained Earnings, Ending (Dec 31.2021) Instructions (20 points) 1. You must analyze the data to calculate the implied fair value of Shallby Company and determine if there is any excess, which will be complete for goodwill. 2. Complete the following table with the controlling interest and noncontrolling interest values Controlling Interest -Noncontrolling NO Interest. 200 Initial Investment Plus: Net Income Less: Dividend Ending livestment Present the Income Statement and the Retained Earnings Statement Shallby Company Income Statement For the year ended December 31, 2021 Sales Reques $190,000 Less: Cost of Goods Sold (125.000) Gross Profit $65.000 Less: Operating Expenses (25,000 Net Income $40.000 Shallby Company Retained Earnings Statement For the year ended December 31, 2021 Retained Earnings. Beginning (Jan. 1.2030) Plus: Nei income 550.000 40.0% S90.000 (20.000) $70.000 Less: Dividends Declared Retained amnings, Ending (Dec.31.2021)