Details of this Paper

Combined Income and Retained Earning Statements for the year ended




Prepare working papers to consolidate the financial statements of Pan Corporation and Subsidiary at and for the year ended December 31, 2010;Consolidated working papers (downstream sales);Pan Corporation acquired 100% of Sal Corporation's oustanding votiong common stock on Jan 1, 2009, for $660,000 cash. Sal's stockholders' equity on this date consisted on $300,000 capital stock and $300,000 retained earnings. The difference between the price paid by Pan Corporation and the underlying equity aquired in Sal Corporation was allocated $30,000 to Sal's undervalued inventory and the remainder to goodwill(which is not amortized). The undervalued inventory items were sold by Sal during 2009.;Pan made sales of $100,000 to Sal at a gross profit of $40,000 during 2009, during 2010, Pan made sales of $120,000 to Sal at a gross profit of $48,000. One-half the 2009 sales were invetoried by Sal at year-end 2009, and one-fourth of the 2010 sales were inventoried by Sal at year-end 2010. Sal owed Pan $17,000 on account at December 21, 2010.;The separate financial statements of Pan and Sal Corporations at and for the year ended December 31, 2010, are summarized as follows;Combined Income and Retained Earning Statements;for the year ended December 31, 2010 (in thousands);Sales;Pan:$800 Sal:$400;Income from Sal;Pan: $108 Sal:$-;Cost of Sales;Pan:$(400) Sal: $(200);Depreciation Expense;Pan: $(110) Sal: $(40);Other Expenses;Pan: $(192) Sal: $(60);Net Income;Pan: $206 Sal: $100;Beginning Retained Earnings;Pan: $606 Sal: $380;Less: Dividends;Pan: $(100) Sal: $(50);Retained Earnings December 31, 2010;Pan: $712 Sal: $430;Balance Sheet at December 31, 2010;Cash;Pan: $54 Sal: $37;Receivables-net;Pan: $90 Sal: $60;Inventories;Pan: $100 Sal: $80;Other Assets;Pan: $70 Sal: $90;Land;Pan: $50 Sal: $50;Buildings-net;Pan: $200 Sal: $150;Equipment-net;Pan: $500 Sal: $400;Investment in Sal;Pan: $748 Sal: $-;Total assets;Pan: $1,812 Sal: $867;Account Payable;Pan: $160 Sal: $47;Other Liabilities;Pan: $340 Sal: $90;Common Stock, $10 par;Pan: $600 Sal: $300;Retained Earnings;Pan: $712 Sal: $430;Total Equities;Pan: $1,812 Sal: $867


Paper#27683 | Written in 18-Jul-2015

Price : $32