Problem 08-10 (LO2) On January 1, Year 5, Pic Company acquired 7,500 ordinary shares of Sic Company for $825,000. On January 1, Year 6, Pic Company acquired an additional 2,000 ordinary shares of Sic Company for $207000. On January 1, Year 5, the shareholders' equity of Sic was as follows: Ordinary shares (10,000 no par value shares issued) Ketained earnings $200, 000 309, 000 $509, 000 The following are the statements of retained earmings for the two companies for Years 5 and 6: Pie Year 5 $ S18,000 141,500 (100,000) $ 559,500 Sie Year S $ 309,000 139,000 (90,000) Retained earnings, beginning of year Year 6 Year 6 $ 559, 500 149, 500 (120, 000) $ 589,000 $ 358, 000 Profit 201,000 Dividends Retained earnings, end of year (00, 000) $ 358,000 $ 469, 000 Additional Information • Pic uses the cost method to account for its Investment in Sic. • Any acquisition differential is allocated to customer contracts, which are expected to provide future benefits until December 31, Year 7. Neither company has any customer contracts recorded on their separate-entity records. • There were no unrealized profits from intercompany transactions since the date of acquisition. Required: (n) Calculate consolidated profit attributable to Pic's shareholders for Year 6. (Omit S sign in your response.)
Problem 08-10 (LO2) On January 1, Year 5, Pic Company acquired 7,500 ordinary shares of Sic Company for $825,000. On January 1, Year 6, Pic Company acquired an additional 2,000 ordinary shares of Sic Company for $207000. On January 1, Year 5, the shareholders' equity of Sic was as follows: Ordinary shares (10,000 no par value shares issued) Ketained earnings $200, 000 309, 000 $509, 000 The following are the statements of retained earmings for the two companies for Years 5 and 6: Pie Year 5 $ S18,000 141,500 (100,000) $ 559,500 Sie Year S $ 309,000 139,000 (90,000) Retained earnings, beginning of year Year 6 Year 6 $ 559, 500 149, 500 (120, 000) $ 589,000 $ 358, 000 Profit 201,000 Dividends Retained earnings, end of year (00, 000) $ 358,000 $ 469, 000 Additional Information • Pic uses the cost method to account for its Investment in Sic. • Any acquisition differential is allocated to customer contracts, which are expected to provide future benefits until December 31, Year 7. Neither company has any customer contracts recorded on their separate-entity records. • There were no unrealized profits from intercompany transactions since the date of acquisition. Required: (n) Calculate consolidated profit attributable to Pic's shareholders for Year 6. (Omit S sign in your response.)
Chapter14: Corporation Accounting
Section: Chapter Questions
Problem 8PB: Tent Tarp Corporation is a manufacturer of outdoor camping equipment. The company was incorporated...
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