STILL, SAYS THINGS AND IS WRONG?? I AM VERY CONFUSED PLEASE FORMAT HOW IT IS SHOWN. 
STILL, SAYS THINGS AND IS WRONG?? I AM VERY CONFUSED PLEASE FORMAT HOW IT IS SHOWN.
On January 1, 2017, Holland Corporation paid $9 per share to a group of Zeeland Corporation shareholders to acquire 60,000 shares of Zeeland's outstanding voting stock, representing a 60 percent ownership interest. The remaining 40,000 shares of Zeeland continued to trade in the market close to its recent average of $7.50 per share both before and after the acquisition by Holland. Zeeland's acquisition date balance sheet follows: Current assets Property and equipment (net) Patents $ 16,500 310,500 222,500 $ 549,500 Liabilities Common stock Retained earnings $ 249,500 100,000 200,000 $ 549,500 On January 1, 2017, Holland assessed the carrying amount of Zeeland's equipment (5-year remaining life) to be undervalued by $42,000. Holland also determined that Zeeland possessed unrecorded patents (10-year remaining life) worth $398,900. Zeeland's acquisition-date fair values for its current assets and liabilities were equal to their carrying amounts. Any remaining excess of Zeeland's acquisition-date fair value over its book value was attributed to goodwill. The companies' financial statements for the year ending December 31, 2018, follow: The companies financial statements for the year ending December 31, 2018, follow: $ Sales Cost of goods sold Depreciation expense Amortization expense Other operating expenses Equity in Zeeland earnings Separate company net income Holland (489,000) 248, 200 61,000 16,500 62,000 (52,026) (153, 326) Zeeland $ (453,500) 212,500 31,500 18,500 56,000 0 $ (135,000) $ $ Retained earnings 1/1 Net income Dividends declared Retained earnings 12/31 (822,700) (153,326) 50,000 (926,026) $ (364,000) (135,000) 30,000 $ (469,000) $ Current assets Investment in Zeeland Property and equipment (net) Patents Total assets $ 127,500 643, 452 862,000 154,000 $ 1,786,952 $ 106,500 0 284,000 181,500 $ 572,000 Liabilities Common stock - Holland Common stock - Zeeland Retained earnings 12/31 Total liabilities and owners equity $ (540,926) (320,000) 0 (926,026) $(1,786,952) $ (3,000) 0 (100,000) (469,000) $ (572,000) At year-end, there were no intra-entity receivables or payables. a. Compute the amount of goodwill recognized in Holland's acquisition of Zeeland and the allocation of goodwill to the controlling and noncontrolling interest. b. Show how Holland determined its December 31, 2018, Investment in Zeeland account balance. c. Prepare a worksheet to determine the amounts that should appear on Holland's December 31, 2018, consolidated financial statements. Accounts Sales HOLLAND CORPORATION AND ZEELAND CORPORATION Consolidation Worksheet For Year Ending December 31, 2018 Consolidation Entries Noncontrolling Holland Zeeland Debit Credit Interest $ (489,000) $ (453,500) 248,200 212,500 61,000 31,500 8,400 16,500 18,500 39,890 62,000 56,000 (52,026) 0 52,026 $ (153,326) $ (135,000) Consolidated Totals $ (942,500) 460,700 100,900 74,890 118,000 0 $ (188,010) (34,684) $ Cost of goods sold Depreciation expense Amortization expense Other operating expenses Equity in Zeeland earnings Separate company net income Consolidated net income Noncontrolling interest in CNI Controlling interest net income Retained earnings, 1/1/18 Net income Dividends declared Retained earnings, 12/31 Current assets Investment in Zeeland, Inc Property and equipment (net) Patents Goodwill 364,000 $ $ (364,000) (135,000) 30,000 $ (469,000) $ 106,500 18,000 12,000 $ (822,700) (153,326) 50,000 $ (926,026) 127,500 643,452 862,000 154,000 $ (188,010) (822,700) (153,326) 50,000 (926,026) 234,000 0 1,171,200 654,620 99,100 $ 0 18,000 33,600 661,452 8,400 284,000 181,500 0 359,010 39,890 0 99,100 Total assets $ 1,786,952 $ 572,000 $ 2,158,920 Liabilities (540,926) (320,000) (3,000) (100,000) 100,000 346,284 (346,284) Common stock Noncontrolling interest Retained earnings, 12/31 Total liabilities and equities (543,926) (320,000) (368,968) (926,026) $ (2,158,920) (926,026) (469,000) $ (572,000) |(1,786,952) 1,074,026 $ 1,074,026
