ACC 545 Week 6 Consolidation work and financial statements subsequent to acquisition;Week 6 -- Consolidated Financials ?;Consolidation work and financial statements subsequent to acquisition;Assignment;Background and Information;Palus Corporation acquired 90 percent of Stalus Company's voting stock on January 1, 2010. The price paid was $145,000. The excess of costs over book value was $10,000, which should be attributed to goodwill and must be amortized over 10 years. The fair value of the non-controlling (minority) interest was equal to 10 percent of the book value of Stalus at that date. Palus uses the equity method in accounting for its ownership of Stalus during the year 2010. Income during the year was $30,000 for Stalus and the company also declared dividends of $10,000. On December 31, 2010, the trial balances of the two companies are as follows;Palus Corporation;Stalus Corporation;Item;Debit;Credit;Debit;Credit;Current Assets;$173,000;$105,000;Depreciable Assets;500,000;300,000;Investment in Stalus Company;163,000;Dividends Declared;10,000;Accumulated Depreciation;175,000;75,000;Current Liabilities;171,000;115,000;Long-Term Debt;100,000;45,000;Common Stock;200,000;100,000;Retained Earnings;123,000;50,000;Sales;100,000;80,000;Expenses;60,000;50,000;Income from Subsidiary;27,000;$896,000;$896,000;$465,000;$465,000;Required;A. Prepare all eliminating journal entries required as of December 31, 2010, to prepare the consolidated worksheet.;B. Prepare a condensed consolidation worksheet showing the trial balance, eliminations and adjustments, controlling retained earnings, controlling income statement, and consolidated balance sheet.;C. Prepare the formal consolidated balance sheet, income statement, and retained earnings statements as of December 31, 2010.
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