On 1 April 2000, X, a limited liability company, paid $120,000 for 48,000 $1 shares in Y, another limited liability company, representing 80% of Y’s $60,000 share capital. The retained earnings of Y at that date were $70,000. At 31 March 2005 the retained earnings of the companies were: $ X 180,000 Y 100,000 All goodwill arising has been written off because of impairment. What figure should appear in the consolidated balance sheet of the X group at 31 March 2005 for retained earnings? A $208,000 B $8,000 C $204,000 D $188,000
On 1 April 2000, X, a limited liability company, paid $120,000 for 48,000 $1 shares in Y, another limited liability company, representing 80% of Y’s $60,000 share capital. The retained earnings of Y at that date were $70,000. At 31 March 2005 the retained earnings of the companies were: $ X 180,000 Y 100,000 All goodwill arising has been written off because of impairment. What figure should appear in the consolidated balance sheet of the X group at 31 March 2005 for retained earnings? A $208,000 B $8,000 C $204,000 D $188,000
Chapter7: Corporations: Reorganizations
Section: Chapter Questions
Problem 43P
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Question
On 1 April 2000, X, a limited liability company, paid $120,000 for 48,000 $1 shares in Y, another limited liability
company, representing 80% of Y’s $60,000 share capital. The
At 31 March 2005 the retained earnings of the companies were:
$
X 180,000
Y 100,000
All
What figure should appear in the consolidated balance sheet of the X group at 31 March 2005 for retained
earnings?
A $208,000
B $8,000
C $204,000
D $188,000
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