Compute the amounts that beckman should report

Reference no: EM131881351

Problem

On January 1, Beckman, Inc., acquires 60 percent of the outstanding stock of Calvin for $66,312. Calvin Co. has one recorded asset, a specialized production machine with a book value of $14,000 and no liabilities. The fair value of the machine is $100,000, and the remaining useful life is estimated to be 10 years. Any remaining excess fair value is attributable to an unrecorded process trade secret with an estimated future life of 4 years. Calvin's total acquisition date fair value is $110,520. At the end of the year, Calvin reports the following in its financial statements:

Revenues $ 57,750

Machine $ 12,600

Common stock $ 10,000

Expenses 24,150

Other assets 26,000

Retained earnings 28,600

Net income $ 33,600

Total assets $ 38,600

Total equity $ 38,600

Dividends paid $ 5,000

Determine the amounts that Beckman should report in its year-end consolidated financial statements for:

noncontrolling interest in subsidiary income

noncontrolling interest

Calvin's machine (net of accumulated depreciation)

process trade secret.

Reference no: EM131881351

Questions Cloud

Discuss the inventory pricing methods : Which of the three inventory pricing methods provide the most realistic balance sheet valuation of inventory in light of the current replacement cost.

Calculate the anpv for each project : The cost of capital is 10% and project M has a three-year cash flow period while project N has a six-year cash flow period.

Fair market interest rate for such bonds : Would you pay $816 for each bond if you thought that a "fair" market interest rate for such bonds was 14%-that is, if rd= 14%?

Explain the concept of make or buy decisions : Explain the concept of make or buy decisions. What are some of the potential errors that go into this calculation?

Compute the amounts that beckman should report : Compute the amounts that Beckman should report in its year-end consolidated financial statements for: noncontrolling interest and Calvin's machine.

Manufacturing and the service industries : How do doffferent quality theories impact various industries such as manufacturing and the service industries?

Major changes occurring in our social world : There are major changes occurring in our social world with regard to drug use and legalization. Several states, including California, Colorado

What fraction of the investors net worth should be held : Which security should an investor choose if she wants to (i) maximize expected returns, (ii) minimize risk (assume the investor cannot form a portfolio)?

Market value is less than book value : What does it mean when a firm tread at a price to book ratio less than 1 ? Does that mean that market value is less than book value?

User Account

All Pages