Question
The following are selected account balances from Penske Company and Stanza Corporation as of December 31, 2021: Penske Stanza Revenues $ (832,000) $ (424,000) Cost
The following are selected account balances from Penske Company and Stanza Corporation as of December 31, 2021:
Penske | Stanza | ||||||||
Revenues | $ | (832,000) | $ | (424,000) | |||||
Cost of goods sold | 296,200 | 106,000 | |||||||
Depreciation expense | 227,000 | 390,000 | |||||||
Investment income | Not given | 0 | |||||||
Dividends declared | 80,000 | 60,000 | |||||||
Retained earnings, 1/1/21 | (614,000) | (326,000) | |||||||
Current assets | 570,000 | 698,000 | |||||||
Copyrights | 920,000 | 501,000 | |||||||
Royalty agreements | 626,000 | 1,160,000 | |||||||
Investment in Stanza | Not given | 0 | |||||||
Liabilities | (606,000) | (1,885,000) | |||||||
Common stock | (600,000) | ($20 par) | (200,000) | ($10 par) | |||||
Additional paid-in capital | (150,000 | ) | (80,000 | ) | |||||
Note: Parentheses indicate a credit balance.
On January 1, 2021, Penske acquired all of Stanzas outstanding stock for $874,000 fair value in cash and common stock. Penske also paid $10,000 in stock issuance costs. At the date of acquisition, copyrights (with a six-year remaining life) have a $598,000 book value but a fair value of $700,000.
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As of December 31, 2021, what is the consolidated copyrights balance?
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For the year ending December 31, 2021, what is consolidated net income?
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As of December 31, 2021, what is the consolidated retained earnings balance?
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As of December 31, 2021, what is the consolidated balance to be reported for goodwill?
Amounts a. Consolidated copyrights $ 1,506,000 b. Consolidated net income c. Consolidated retained earnings Consolidated goodwill d. $ 166,000
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