Use the folioy information for the next 11 items On January 1, 2016, Paris Company acquired 80% of the voting commaon stock of Sun Co. for $600,000 cash. The two companies had the following balance sheets on date of acquisition (Book values). 10. In the consolidation worksheet for 2016, the entry to distribute the excess of fair value over book value will include which of the following? a. Credit Retained Earnings - Sun $29,000. b. Debit Goodwill $45,000 Pparis sun . Debit Retained Earnings - Paris $116,000 Current Assets $700,000 d. Aand C Equipment (Net) 1,520,000 e. AandB Total Assets 2,220,000 Current Liabilities $500,000 Correct Answer: E Common Stock 100,000 Additional Paid-in Capital 900,000 Retained Earnings 720,000 11 Inthe consolidation worksheet for 2016, after amortizing the excess of cost over book value, what will be the Total Liabilities and Equity 2,220,000 consolidated income for Paris and Sun? = a. $188,000 On the date of acquisition, the fair values of Sun's assets and liabilities were equal to their book values except : g;iggg for equipment which had a fair value of $650,000. The equipment had a remaining useful life of 10 years and d. $330.000 no salvage value. Any remaining excess is goodwill. o $170,000 Paris and Sun had the following information for 2016 and 2017. Correct Answer: B Paris Sun 2016 Net Income (Internally Generated) $170,000 $60,000 12 Inthe consolidation worksheet for 2016, what will be the Non-Controlling Interest's share of consolidated net Dividends 30,000 12,000 income? 2017 a. $10,000 Net Income (Internally Generated) 200,000 50,000 b. $12,000 Dividends 23,000 14,000 c $44,000 d. $43,600 e. $46,000 Correct Answer: A 13. what will be the value of the Non-Controlling Interest in the consolidated balance sheet for 20167 a. $131,000 b. None of these $135,400 d. $133,400 e. $121,000 Correct Answer: B. Use the following information for the next 11 items On January 1, 2016, Paris Company acquired 80% of the voting common stock of Sun Co. for $600,000 cash. 14, In the consolidation worksheet for 2017 (second year), the entry to amortize the excess of cost over baok The two companies had the following balance sheets on date of acquisition (Baok values). value will be a. Debit Depreciation Expense - Equipment $10,000, Credit Accumulated Depreciation Equipment $10,000. Paris sun b. Debit Depreciation Expense Equipment $20,000, Credit Accumulated Depreciation Equipment Current Assets $700,000 $175,000 $20,000. Equipment (Net) 1,520,000 550,000 c. Debit Depreciation Expense Equipment $10,000, Debit Retained Earnings Paris 58,000, Debit Total Assets. 2,220,000 725,000 Retained Earnings Sun $2,000, Credit Accumulated Depreciation - Equipment $10,000, Credit Current Liabilities $500,000 120,000 Investment in Sun $10,000 Common Stock 100,000 80,000 d. Debit Depreciation Expense Equipment $10,000, Debit Retained Earnings Paris $8,000, Debit Additional Paid-in Capital 900,000 300,000 Retained Earnings - Sun $2,000, Credit Accumulated Depreciation - Equipment $20,000. Retained Earnings 720,000 225,000 Total Liabilities and Equity 2,220,000 725,000 Correct Answer: D On the date of acquisition, the fair values of Sun's assets and liabilities were equal to their book values except for equipment which had a fair value of $650,000. The equipment had a remaining useful life of 10 years and no salvage value. Any remaining excess is gooduwill. Paris and Sun had the following information for 2016 and 2017. Paris Sun 2016 Net Income (Internally Generated) 170,000 560,000 Dividends 30,000 12,000 2017 Net Income (Internally Generated) 200,000 50,000 Dividends 23,000 14,000