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Use the following information for questions 5 through 9. On January 1, 20X9, Zigma Company acquired 100 percent of Standard Company's common shares at underlying

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Use the following information for questions 5 through 9. On January 1, 20X9, Zigma Company acquired 100 percent of Standard Company's common shares at underlying book value, i.e., paying the same as Standard Co.'s book value. The balance of Retained Earnings on January 1, 20X9 for Zigma is 175,000, and for Standard is 35,000. Zigma uses the equity method in accounting for its ownership of Standard. On December 31, 20X9, the trial balances of the two companies are as follows: Zigma Co. Standard Co. Item Debit Credit Debit Credit Current assets 23 8000 95000 Depreciable assets 300000 170000 Investment in Standard Co. 100000 Other expenses 90000 70000 Depreciation expense 30000 17000 Dividends declared 32000 10000 Accumulated depreciation 120000 85 000 Current liabilities 50000 30000 Long-term debt 120000 50000 Common stock 100000 50000 Retained earnings 175000 35000 Sales 200000 112000 Income from Standard Co. w 790000 790000 362000 362000 5. On December 31, 20x9, which of the following nancial statements need to be consolidated by Zigma? 0 only income statement 0 all of the nancial statements 0 only balance sheet 0 only statement of retained earnings 6. On the Consolidated income statement, "Income from Standard Co." has a balance of O Information is insufficient to figure out the balance. O 35,000 OO O 25,0007. On the consolidated statement of retained earnings, retained earnings has a beginning balance of 0 175,000 0 298,000 0 50,000 0 248,000 8. On the consolidated balance sheet, common stock has a balance of 0 none of the above 0 150,000 0 50,000 0 100,000 9. On the consolidated statement of retained earnings, dividends declared has a balance of 0 42,000 0 22,000 0 10,000 0 32,000 10. On the consolidated statement of retained earnings. retained earnings has an ending balance of 0 298,000 0 50,000 0 175,000 0 248,000

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