80.2K

Verified Solution

Link Copied!

ProForm acquired 60 percent of ClipRite on June 30, 2020, for $1,200,000 in cash. Based on ClipRite's acquisition-date fair value, an unrecorded intangible of $550,000 was recognized and is being amortized at the rate of $18,000 per year. No goodwill was recognized in the acquisition. The noncontrolling interest fair value was assessed at $800,000 at the acquisition date. The 2021 financial statements are as follows: Sales Cost of goods sold Operating expenses Dividend income Net income Retained earnings, 1/1/21 Net income Dividends declared Retained earnings, 12/31/21 Cash and receivables Inventory Investment in clipRite Fixed assets Accumulated depreciation Totals Liabilities Common stock Retained earnings, 12/31/21 Totals ProForm $(1,020,000) 645,000 320,000 (42,000) $ (97,000) $ (3,600,000) (97,000) 320,000 $ (3,377,000) $ 620,000 510,000 1,200,000 2,100,000 (300,000) $ 4,130,000 $ (553,000) (200,000) (3,377,000) $ (4,130,000) ClipRite $(1,040,000) 510,000 210,000 0 $ (320,000) $(1,070,000) (320,000) 70,000 $(1,320,000) $ 520,000 920,000 0 1,700,000 (650,000) $ 2,490,000 $ (970,000) (200,000) (1,320,000) $(2,490,000) (Note: Parentheses indicate a credit balance.) ClipRite sold ProForm inventory costing $91,000 during the last six months of 2020 for $310,000. At year-end, 30 percent remained. ClipRite sold ProForm inventory costing $310,000 during 2021 for $470,000. At year-end, 10 percent is left. Determine the consolidated balances for the following: (Input all amounts as positive values.) Determine the consolidated balances for the following: (Input all amounts as positive values.) Sales Cost of Goods Sold Operating Expenses Dividend Income Net Income Attributable to Noncontrolling Interest Inventory Noncontrolling Interest in Subsidiary, 12/31/21 & Answer is complete but not entirely correct. Consolidated Balance Sales $ $ Cost of goods sold Operating expenses Dividend income 1,590,000 635,300 548,000 $ $ 0 $ Net income attributable to noncontrolling interest Inventory Noncontrolling interest in subsidiary, 12/31/21 $ 140,680 1,414,000 837,080 X $

Answer & Explanation Solved by verified expert

See Answer