How the consolidated retained earnings amount will be

Assignment Help Accounting Basics

Reference no: EM13581363

Strong Co. acquired all of the outstanding stock of Weak Co. on Jan 1, 2012 for $360,000in cash. Annual excess amortization of $5,000 results from this transaction. On the date of the takeover, Strong reported retained earnings of $100,000 and Weak reported a $50,000 balance Strong reported internal income of $30,000 in 2012 and 35,000 in 2013 and paid $5,000 in dividends each year. Weak reported net income of $15,000 in 2012 and 20,000 in 2013 and paid dividends of $2,000 in each year.

Assume that Strong Co.'s internal income figures above do not include any income from Weak Co.

1.If the parent uses equity method, what is the amount reported as consolidated Retained Earnings on December 31, 2013

2.How the consolidated retained earnings amount will be different if Strong uses either the initial value method or the partial equity method for internal accounting purpose?

Reference no: EM13581363

Questions Cloud

Water is moving with a speed of 23 ms through a perfectly : water is moving with a speed of 2.3 ms through a perfectly sealed long pipe with a cross sectional area of 5 cm2. the

Winnys office furniture has a contribution margin ratio of : winnys office furniture has a contribution margin ratio of 16. if fixed costs are 177300 how many dollars of revenue

You purchase a home in feb 10th 2013 that you are going to : you purchase a home in feb 10th 2013 that you are going to use as a rental property. you paid 180000 and the land was

Sales totaled 1775500 variable selling expenses totaled : carr company produces a single product.during the past year carr manufactured 38000 units and sold 26500

How the consolidated retained earnings amount will be : strong co. acquired all of the outstanding stock of weak co. on jan 1 2012 for 360000in cash. annual excess

Mri company has one employee fica social security taxes are : mri company has one employee. fica social security taxes are 6.20 of the first 106800 paid to its employee and fica

Theta corporation formed 15 years ago in its first year it : theta corporation formed 15 years ago. in its first year it elected to use the cash method of accounting and adopted a

Which consists of a point charge of magnitude e surrounded : the neutral hydrogen atom in its normal state behaves in some respects like an electric charge distribution which

In addition include the tax benefits savings for the first : prepare a 500-750 word written response to the following in january 2010 salem corporation purchased 350000 of new

User Account

All Pages