The first two columns of Exhibit 14 13 present information from the accounting records of Company P and Company S on December 31, 2014 Company P acquired 100 of the common stock of Company S on January 1, 2013, when the balance in Company Ss retained earnings was $40,000 Company P attributes any ex...

a Company P Company S Consolidated Assets Cash 36000 26000 62000 Accounts and Notes Receivable 18000 ...

The first two columns of Exhibit 14.13 present information from the accounting records of Company P and

Question:

The first two columns of Exhibit 14.13 present information from the accounting records of Company P and Company S on December 31, 2014. Company P acquired 100% of the of Company S on January 1, 2013, when the balance in Company S€™s retained earnings was $40,000. Company P attributes any excess of acquisition cost over the carrying value of the net assets of Company S to a building with a 10-year remaining life as of January 1, 2013. Company P holds a note issued by Company S in the amount of $16,400 on December 31, 2014.
a. Enter the appropriate amounts in the Consolidated column for a consolidated of Company P and Company S on December 31, 2014.
b. Compute the acquisition cost of Company P€™s investment in Company S on January 1, 2013.
c. Prepare an analysis that explains the changes in the Investment in Company S account between January 1, 2013, and December 31,2014.

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...