Reference no: EM13342473
The Delaware Corp acquired 92% of 150,000 outstanding shares of Maryland corp 1/1/13 for $7.20/share.
Remaining shares are sold for the same during acquisition. Assets/liabilities (fair market value) are the same as book value. The exception is for a trademark that has a useful life of 4 years and is undervalued by $120,000. The difference is considered goodwill.
Maryland Corp reported:
Additional paid in capital: $190,000
Retained earnings: $450,000
Common Stock: $120,000.
See trial balances for both corporations as of 12/31/14:
Delaware Maryland
Sales (900,000) (275,000)
COGS 465,000 135,000
Operating Expenses 125,000 72,000
Dividend Income (46,000) -
Net Income (356,000) (68,000)
Retained Earnings, 1/1/14 (760,000) (500,000)
Dividends Declared 76,000 50,000
Retained Earnings 12/31/14 (1,040,000) (518,000)
Current Assets 240,000 250,000
Investment in Maryland, 993,600 -
Buildings 1,200,000 478,000
Trademarks 140,000 200,000 - -
Liabilities (78,000) (100,000)
Common Stock (600,000) (120,000)
APIC (855,600) (190,000)
1. Show all consolidating entries for 12/31/14
2. Show the Non-controlling interest value for Maryland for 12/31/14
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