ADVANCED ACCOUNTING(LL) W/CONNECT
13th Edition
ISBN: 9781260282382
Author: Hoyle
Publisher: MCG
expand_more
expand_more
format_list_bulleted
Concept explainers
Videos
Textbook Question
Chapter 2, Problem 19P
Problems 19 and 20 are based on the following information. The separate condensed balance sheets of Patrick Corporation and its wholly owned subsidiary, Sean Corporation, are as follows:
| BALANCE SHEETS December 31, 2017 |
||
| Patrick | Sean | |
| Cash | $ 80,000 | $ 60,000 |
| Accounts receivable (net) | 140,000 | 25,000 |
| Inventories | 90,000 | 50,000 |
| Plant and equipment (net) | 625,000 | 280,000 |
| Investment in Sean | 460,000 | |
| Total assets | $1,395,000 | $415,000 |
| Accounts payable | $ 160,000 | $ 95,000 |
| Long-term debt | 110,000 | 30,000 |
| Common stock ($10 par) | 340,000 | 50,000 |
| Additional paid-in capital | 10,000 | |
| Retained earnings | 785,000 | 230,000 |
| Total liabilities and shareholders’ equity | $ 1,395,000 | $415,000 |
Additional Information:
- On December 31, 2017, Patrick acquired 100 percent of Sean’s voting stock in exchange for $460,000.
- At the acquisition date, the fair values of Sean’s assets and liabilities equaled their carrying amounts, respectively, except that the fair value of certain items in Sean’s inventory were $25,000 more than their carrying amounts.
19. In the December 31, 2017, consolidated balance sheet of Patrick and its subsidiary, what amount of total assets should be reported?
- a. $1,375,000
- b. $1,395,000
- c. $1,520,000
- d. $1,980,000
Expert Solution & Answer
Trending nowThis is a popular solution!
Students have asked these similar questions
The separate condensed balance sheets of Patrick Corporation and its wholly-owned subsidiary, Sean Corporation, are as follows:
BALANCE SHEETS
December 31, 2020
Patrick
Sean
Cash
$
74,000
$
76,000
Accounts receivable (net)
130,000
38,000
Inventories
86,000
54,000
Plant and equipment (net)
626,000
274,000
Investment in Sean
456,000
-
Total assets
$
1,372,000
$
442,000
Accounts payable
178,000
80,000
Long-term debt
110,000
26,000
Common stock ($10 par)
322,000
46,000
Additional paid-in capital
12,000
Retained earnings
762,000
278,000
Total liabilities and shareholders' equity
$
1,372,000
$
442,000
Additional Information:
On December 31, 2020, Patrick acquired 100 percent of Sean’s voting stock in exchange for $456,000.
At the acquisition date, the fair values of Sean’s assets and liabilities equaled their carrying amounts, respectively, except that the fair value of certain items in Sean’s inventory were…
The separate condensed balance sheets of Patrick Corporation and its wholly-owned subsidiary, Sean Corporation, are as follows:
BALANCE SHEETS
December 31, 2020
Patrick
Sean
Cash
$
80,000
$
42,000
Accounts receivable (net)
140,000
28,000
Inventories
86,000
60,000
Plant and equipment (net)
640,000
278,000
Investment in Sean
454,000
-
Total assets
$
1,400,000
$
408,000
Accounts payable
172,000
86,000
Long-term debt
100,000
26,000
Common stock ($10 par)
306,000
70,000
Additional paid-in capital
14,000
Retained earnings
822,000
212,000
Total liabilities and shareholders' equity
$
1,400,000
$
408,000
Additional Information:
On December 31, 2020, Patrick acquired 100 percent of Sean’s voting stock in exchange for $454,000.
At the acquisition date, the fair values of Sean’s assets and liabilities equaled their carrying amounts, respectively, except that the fair value of certain items in Sean’s inventory were…
The following is the balance sheet of Sameed Brothers Corporation (000s omitted).
Sameed Brothers CorporationBalance SheetDecember 31, 2020
Assets
Current assets
Cash
$26,000
Marketable securities
18,000
Accounts receivable
25,000
Inventory
20,000
Supplies
4,000
Stock investment in subsidiary company
20,000
$113,000
Investments
Treasury stock
25,000
Property, plant, and equipment
Buildings and land
91,000
Less: Reserve for depreciation
31,000
60,000
Other assets
Cash surrender value of life insurance
19,000
Total assets
$217,000
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable
$22,000
Reserve for income taxes
15,000
Customers' accounts with credit balances
1
$ 37,001
Deferred credits
Unamortized premium on bonds payable
2,000
Long-term liabilities
Bonds payable
60,000
Total liabilities
99,001
Common…
Chapter 2 Solutions
ADVANCED ACCOUNTING(LL) W/CONNECT
Ch. 2 - Prob. 1QCh. 2 - Prob. 2QCh. 2 - What does the term consolidated financial...Ch. 2 - Within the consolidation process, what is the...Ch. 2 - Prob. 5QCh. 2 - Prob. 6QCh. 2 - Prob. 7QCh. 2 - Prob. 8QCh. 2 - Prob. 9QCh. 2 - Prob. 10Q
Ch. 2 - Prob. 11QCh. 2 - Which of the following does not represent a...Ch. 2 - Prob. 2PCh. 2 - Prob. 3PCh. 2 - Prob. 4PCh. 2 - Prob. 5PCh. 2 - An acquired entity has a long-term operating lease...Ch. 2 - When does gain recognition accompany a business...Ch. 2 - Prob. 8PCh. 2 - Prob. 9PCh. 2 - Prob. 10PCh. 2 - On June 1, Cline Co. paid 800,000 cash for all of...Ch. 2 - On May 1, Donovan Company reported the following...Ch. 2 - Prob. 13PCh. 2 - Prob. 14PCh. 2 - Prob. 15PCh. 2 - Prob. 16PCh. 2 - On its acquisition-date consolidated balance...Ch. 2 - On its acquisition-date consolidated balance...Ch. 2 - Problems 19 and 20 are based on the following...Ch. 2 - In the December 31, 2017, consolidated balance...Ch. 2 - Prob. 21PCh. 2 - The following book and fair values were available...Ch. 2 - Prob. 23PCh. 2 - Prob. 24PCh. 2 - Prob. 25PCh. 2 - Prob. 26PCh. 2 - Prob. 27PCh. 2 - Prob. 28PCh. 2 - Prob. 29PCh. 2 - Prob. 30PCh. 2 - Prob. 31PCh. 2 - SafeData Corporation has the following account...Ch. 2 - Prob. 33PCh. 2 - Prob. 34PCh. 2 - Prob. 35APACh. 2 - On February 1, Piscina Corporation completed a...Ch. 2 - Prob. 37APBCh. 2 - Prob. 38APBCh. 2 - Prob. 1DYSCh. 2 - Prob. 2DYSCh. 2 - Prob. 3DYSCh. 2 - Prob. 4DYS
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Bar Corporation has been looking to expand its operations and has decided to acquire the assets of Vicker Company and Kendal Company. Bar will issue 30,000 shares of its $10 par common stock to acquire the net assets of Vicker Company and will issue 15,000 shares to acquire the net assets of Kendal Company.Vicker and Kendal have the following balance sheets as of December 31, 2015:Assets Vicker KendalAccounts receivable . . . . . . . . . . . . . . . . . $ 200,000 $ 80,000Inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . 150,000 85,000Property, plant, and equipment:Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150,000 50,000Buildings . . . . . . . . . . . . . . . . . . . . . . . . . . . . .500,000 300,000Accumulated depreciation. . . . . . . . .. . . (150,000) (110,000)Total assets . . . . . . . . . .…arrow_forwardArlington Corporation's financial statements (dollars and shares are in millions) are provided here. Balance Sheets as of December 31 2018 2017 Assets Cash and equivalents $ 15,000 $ 12,000 Accounts receivable 35,000 30,000 Inventories 33,720 27,000 Total current assets $ 83,720 $ 69,000 Net plant and equipment 50,000 48,000 Total assets $133,720 $117,000 Liabilities and Equity Accounts payable $ 10,000 $ 8,000 Accruals 7,000 5,000 Notes payable 6,900 5,300 Total current liabilities $ 23,900 $ 18,300 Long-term bonds 15,000 15,000 Total liabilities $ 38,900 $ 33,300 Common stock (4,000 shares) 60,000 60,000 Retained earnings 34,820 23,700 Common equity $ 94,820 $ 83,700 Total liabilities and equity $133,720 $117,000 Income Statement for Year Ending December 31, 2018 Sales $239,000 Operating costs excluding depreciation and amortization 190,000 EBITDA $ 49,000 Depreciation…arrow_forwardArlington Corporation's financial statements (dollars and shares are in millions) are provided here. Balance Sheets as of December 31 2018 2017 Assets Cash and equivalents $ 15,000 $ 12,000 Accounts receivable 35,000 30,000 Inventories 33,720 27,000 Total current assets $ 83,720 $ 69,000 Net plant and equipment 50,000 48,000 Total assets $133,720 $117,000 Liabilities and Equity Accounts payable $ 10,000 $ 8,000 Accruals 7,000 5,000 Notes payable 6,900 5,300 Total current liabilities $ 23,900 $ 18,300 Long-term bonds 15,000 15,000 Total liabilities $ 38,900 $ 33,300 Common stock (4,000 shares) 60,000 60,000 Retained earnings 34,820 23,700 Common equity $ 94,820 $ 83,700 Total liabilities and equity $133,720 $117,000 Income Statement for Year Ending December 31, 2018 Sales $239,000 Operating costs excluding depreciation and amortization 190,000 EBITDA $ 49,000 Depreciation…arrow_forward
- Use the following consolidated balance sheet for Campbell Soup Company annual report. CAMPBELL SOUP COMPANY Consolidated Balance Sheets (Millions, except per share amounts) July 31, 2016 Current assets Cash and cash equivalents $ 296 Accounts receivable, net 626 Inventories 940 Other current assets 46 Total current assets 1,908 Plant assets, net of depreciation 2,407 Goodwill 2,263 Other intangible assets, net of amortization 1,152 Other assets ($34 as of 2016 attributable to variable interest entity) 107 Total assets $ 7,837 Current liabilities Short-term borrowings $ 1,219 Payable to suppliers and others 610 Accrued liabilities 604 Dividend payable 100 Accrued income taxes 22 Total current liabilities 2,555 Long-term debt 2,314 Deferred taxes 396 Other liabilities 1,039…arrow_forwardThe Wondai Ltd Croup reports the following balances in its consolidated financial statements for the year ending 30 June Financial year 2018 $ 2017 $ Buildings 524,000 268,000 ACC Depr. - Buildings 190,000 143,000 Depr Expense - Buildings 50,000 23,000 On1 July 2017. the Wondai Ltd Group acquired 80%. the shares in Yallingup Ltd. which recorded the following account balances at that date: 1 July 2017 $ Buildings 80,000 Acc Depr.- Buildings 32,000 During the year ended 30 June 2018, the Wondai Ltd Group disposed of buildings with a carrying. amount of $63,000 Required: Calculate the amount of consolidated cash flows from investing activities in relation to the purchase of buildings for the year ending 30 June 2018arrow_forwardThe following information relates to Adele Ltd. Since the date of acquisition, Adele Ltd has held interests in multiple subsidiaries totalling DNCI of 25%, and INCI of 15%. The following summarised financial information is provided: Retained earnings at DOA $236,000 Retained earnings at 1/7/2020 $476,000 Current period profit for year ended 30/6/2021 $117,000 a) Based on the financial information you have available, prepare the journal entries to record the allocation to NCI upon consolidation on 30 June, 2021.arrow_forward
- On 1 July 2022, Susan Ltd took control of the assets and liabilities of Adam Ltd. At this date the statement of financial position of Adam Ltd was as follows: Carrying amount Fair value Machinery $60,000 $87,000 Fixtures & Fittings 80,000 88,000 Vehicles 55,000 55,000 Current Assets 30,000 32,000 Current Liabilities (36,000) (38,000) Total Net assets 189,000 Share capital (100 000 shares) 100,000 General reserve 40,000 Retained earnings 49,000 Total Equity 189,000 Susan Ltd agreed to: (i) pay the shareholders of Adam Ltd one share in Susan Ltd for every two shares held in Adam Ltd. Shares in Susan Ltd have a fair value of $2.00 per share. The costs of issuing the shares by Susan Ltd costed $2,800 (ii) pay the shareholders of Adam Ltd $1 in cash for each share held in Adam Ltd. On 1 July 2022, Adam Ltd is currently being sued by a previous customer. The expected damage is $100,000. Lawyers estimate that there is a 10% chance of losing the case.…arrow_forwardThe Davidson Corporation's balance sheet and income statement are provided here. Davidson Corporation: Balance Sheet as of December 31, 2021 (millions of dollars) Assets Cash and equivalents Accounts receivable Inventories Total current assets Net plant and equipment Total assets EBIT Interest EBT Taxes (25%) Net Income $ Common dividends paid Earnings per share Liabilities and Equity 20 Accounts payable 525 Accruals 850 Notes payable $ 1,395 2,525 Davidson Corporation: Income Statement for Year Ending December 31, 2021 (millions of dollars) Total current liabilities Long-term bonds Total liabilities Common stock (100 million shares) Retained earnings Common equity $ 3,920 Total llabilities and equity Sales Operating costs excluding depreciation and amortization EBITDA Depreciation and amortization $ Shares Common Stock $ $ $ $ 130 280 230 640 1,500 $ 2,140 280 $ 5,750 4,440 $ 1,310 240 $ 1,070 190 880 220 660 $ $ $ a. Construct the statement of stockholders' equity for December 31,…arrow_forwardWhite Bright Limited has three subsidiary Companies as on 31st March, 2018. Based upon the information given in the following, ascertain how the Cost of Investment will be treated in the Consolidated Balance Sheet. Particulars Amount in Millions Hazy Limited Clear Limited Sun Limited Investment made 205.00 117.00 145.00 Percent of Shares Owned 60% 65% 75% Assets at the time of Investment 625.40 314.84 443.75 Liabilities at the time of Investment 260.44 134.84 329.55 don't give hand written answers plzarrow_forward
- The Davidson Corporation's balance sheet and income statement are provided here. Davidson Corporation: Balance Sheet as of December 31, 2018 (Millions of Dollars) Assets Liabilities and Equity Cash and equivalents $ 15 Accounts payable $ 100 Accounts receivable 515 Accruals 220 Inventories 830 Notes payable 230 Total current assets $ 1,360 Total current liabilities $ 550 Net plant and equipment 2,550 Long-term bonds 1,500 Total liabilities $ 2,050 Common stock (100 million shares) 260 Retained earnings $ 1,600 Common equity $ 1,860 Total assets $ 3,910 Total liabilities and equity $ 3,910 Davidson Corporation: Income Statement for Year Ending December 31, 2018 (Millions of Dollars) Sales $ 6,000 Operating costs excluding depreciation and amortization 3,780 EBITDA $ 2,220 Depreciation and amortization 420 EBIT $ 1,800 Interest 164 EBT $ 1,636 Taxes…arrow_forwardSolve the following questions:The following information was derived from the 2017 consolidated financial statements of Parents Co.,which owns 80% of AAA Co. as well as 40% of BBB Co.:Equity Earnings from BBB Co. $120,000Decrease in Accounts Payable $5,000Increase in Accounts Receivable $10,000Increase in Inventory $20,000Increase in Bonds Payable $40,000Depreciation $20,000Loss on sale of machinery $10,000Carrying value of machinery sold $60,000Dividends received from BBB Co. $10,000Purchase of a building for cash $400,000Goodwill impairment loss $5,000Entity Net Income allocated to non-controlling interest $5,000Consolidated net income allocated to Parent $950,000Dividends paid by Parents Co. $40,000Dividends paid by AAA Co. $12,000The cash balance at the start of 2017 was $200,000.Required:Prepare the consolidated statement of cash flows for Parents Co. for the year ended December 31,2017arrow_forward1. Given below are the consolidated statements of financial position and the consolidated statement of comprehensive income for Pelangi Berhad and its subsidiary Mentari Berhad: Consolidated Statement of Financial Position as at 31 December 2020 2019 RM'000 RM'000 Property, plant and equipment 1,350 1,300 Investment in associates company 1,000 900 Inventory 900 500 Trade receivables 500 700 Bank 300 150 4,050 3,550 Ordinary shares of RM1 each 2,500 2,500 Retained profits 560 260 Non-controlling interest 590 490 Trade payables 400 300 4,050 3,550 Consolidated Statement of Comprehensive Income for the year ended 31 December 2020 2020 RM'000 Profit 495 Share of profits of associate company (less impairment of goodwill) 130 Profit before tax 625 Тах (50) Profit after tax 575 Profit after tax attributable to: Equity holders of parent company 425 Non-controlling interest 150 575 Additional information: i. Tax charge for the year has been paid. ii. Group depreciation on property, plant and…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,
Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSON
Intermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill Education
Financial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
Accounting
Accounting
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:Cengage Learning,
Accounting Information Systems
Accounting
ISBN:9781337619202
Author:Hall, James A.
Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...
Accounting
ISBN:9780134475585
Author:Srikant M. Datar, Madhav V. Rajan
Publisher:PEARSON
Intermediate Accounting
Accounting
ISBN:9781259722660
Author:J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:9781259726705
Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:McGraw-Hill Education
The KEY to Understanding Financial Statements; Author: Accounting Stuff;https://www.youtube.com/watch?v=_F6a0ddbjtI;License: Standard Youtube License