What is the consolidated entity retained earnings

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Question - Company A acquires Company B for $250,000 in cash on January 1st. The acquisition has no differential versus book value. Company A begins the year with $300,000 in retained earnings, has net income during the year of $130,000, and pays out $60,000 in dividends. Company A follows the cost method for computing its net income. Company B has total assets of $320,000, liabilities of $70,000, common stock of $120,000, and retained earnings of $130,000 as of January 1st. During the year, Company B earns $35,000 in net income and pays no dividend. What is the consolidated entity's retained earnings as of the end of the year?

Reference no: EM132988312

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