ACC CONSOLIDATION WORKSHEET PROBLEM

CONSOLIDATION WORKSHEET PROBLEM Matinefo Prepare the corresponding consolidating worksheets based on the following facts. Companies involved: Parent and Sub. Date of acquisition: Jan. 1, 20X3 Date of the worksheets you must prepare: December 31, 20X4 ” 20X5 ” 20X6 Percentage of common shares of S owned by P 90%Price paid by P $6,000,000 At the time of acquisition these were some values concerning S: Common stock $750,000Aditional paid-in capital $750,000Retained earnings $495,000 Years FMV-BVInventories <1 $600,000Other current assets <1 $225,000Plant & equipment, remaining life: 8 $1,500,000Land $1,050,000Long term liabilities; remaining life: 5 $225,000Intangibles amortization: 10 1,071,667 Intercompany transactions: 20X3 20X4 20X5 20X6Upstream inventory sales - $112,500 $95,625 $102,319% in ending inventory - 9.00% 10.80% 12.96%Gross profit rate on sales - 45.00% 54.00% 64.80% Upstream building sale, Dec. 31 Sold for $1,500,000 Book value at time of sale $420,000 Remaining life: 10 % of S bonds purchased by P, Jan. 1 20% Price paid $1,150,798 BV at that date $1,175,066 Remaining life: 5 Maturity value of acquired bonds $1,200,000 Required: 1. Complete the worksheets for 20X4-6. 2. Show how the Controlling and Non-controlling shares of Income from S were arrived at in X5 and X6. 3. In separate schedules for year ends X5 and X6, reconcile the Investment account with S's stockholders' equity. 4. In separate schedules for year ends X5 and X6, reconcile the ending Noncontrolling Interest with S's stockholders'equity.