Quintina Richmond

Chapter 3
3-2
Part A
Investment in Save
Common Stock
Other Contributed Capital
Cash
Part B
Common Stock Save
Other Contributed Capital Save
Retained Earnings Save
Investment in Save

700,000
400,000
280,000
20,000

320,000
175,000
205,000
700,000

3-5
Common StockSpruce
Other Contributed CapitalSpruce
Retained EarningsSpruce
Land

900,000
440,000
150,000
165,556

Investment in Spruce Company

Treasury Stock
Non-controlling Interest

1,400,000
100,000
155,556

Land 1,400,000/.90 (900,000 + 440,000 + 150,000 - 100,000) = 165,556

3-2
Part A
100,000 /10 = 10,000 shares issued
8,000 /10,000 = 80%
Implied Value (100%) = 120,000/80% = 150,000.
Implied Value of Non-controlling share = 150,000 x 20% = 30,000

Purchase price &implied value

Less: Book value of equity acquired:
Common Stock
Other Contributed captial
Retained earnings
Totabl book Value
Differecnce between implied an book value
Plant Assets

NonControlling
Entire
Parent share Share
Value
120,000
30,000
150,000
80,000
13,200
18,800
112,000

20,000
3,300
4,700
28,000

100,000
16,500
23,500
140,000

8,000
(8,000)

2,000
(2,000)

10,000
(10,000)

Balance

Consolidated Balance Sheet Workpaper

PERRY COMPANY AND SUBSIDIARY SOHO
January 1, 2011
part B

Cash
Accounts Receivable
Inventory
Investment in Soho
Difference between Implied
Value and Book Value
Plant Assets
Accumulated
Depreciation
Total
Current Liabilities
Mortgage Note payable
Common Stock
Perry Company
Soho Company
Other Contribute Capital
Perry Company
Soho Company
Retained Earnings:
Perry Company
Soho Company
Noncontrolling Interest
Total

Perry
Company
39,000
53,000
42,000
120,000

Soho
Company
19,000
31,000
25,000

Eliminations
Debit
Credit

Noncontrolling Consolidated
Interest
Balance
58,000
84,000
67,000

120,000
10,000
10,000

10,000

160,000

110,500

280,500

(52,000)
362,000

(19,500)
166,000

-71,500
528,000

18,500
40,000

26,000

44,500
40,000

120,000

120,000
100,000

100,000

135,000

135,000
16,500

16,500

48,500

48,500
23,500

362,000

166,000

23,500
160,000

30,000
160,000

3-5
Part A
Pat Company Cash balance, 12/31/2010
Less: Cash used in the acquisition of Solo
Pat Company Cash balance after acquisition

$540,000
236,000
$304,000

Consolidated Cash balance, 1/1/2011

Less: Pat Company Cash balance after acquisition
Difference
Less: Cash transfer unrecorded by Solo
Solo's cash balance, 1/1/2011

$352,000
304,000
48,000
10,000
$38,000

30,000

30,000
418,000

Part B
$285,000
Part C
Total stockholders equity
Add: Accounts payable of Solo Company of intercompany
payables eliminated in consolidation
Add: Long-term liabilities of Solo Company
Total assets of Solo Company 1/1/2011

$285,000
110,000
85,000
$480,500

3-9
Part A
Problem 3-9

Purchase price &implied value

Less: Book value of equity acquired:
Common Stock
Other Contributed captial
Retained earnings
Less: Treasurey Stok
Totabl book Value
Differecnce between implied an book value
Plant Assets
Balance

NonControlling
Parent share Share
Total Value
5,800,000
6,444,444
6,444,444
4,725,000
356,400
1,732,500
(1,080,000)
5,733,900
66,100
(66,100)
0

525,000
5,250,000
39,600
396,000
192,500
1,925,000
(120,000) (1,200,000)
637,100
6,371,000
7,344
(7,344)
0

73,444
(73,444)
0

Pope Company and Subsidiary Worksheet, January 1, 2009

part B

Cash
Accounts Receivable
Notes Receivable
Inventory
Investment in Sun Company
Difference between Implied
Value and Book Value
Plant Assets
Accumulated Depreciation
Total
Current Liabilities
Mortgage Note payable
Common Stock
Perry Company
Soho Company
Other Contribute Capital
Perry Company
Soho Company
Retained Earnings:
Perry Company
Soho Company
Noncontrolling Interest
Total

Pope
Company
297,000
432,000
90,000
1,980,000
5,800,000

Sun
Company
165,000
468,000

Eliminations
Debit
Credit

Noncontrolling
Interest

90,000
1,447,000

3,427,000
5,800,000

5,730,000
1,575,000
15,904,000

3,740,000
908,000
6,728,000

698,000
2,250,000

247,000
110,000

73,444
73,444

73,444
9,543,444
2,483,000
22,632,000
945,000
2,270,000

90,000

4,500,000

4,500,000
5,250,000

5,250,000

5,198,000

5,198,000
396,000
(1,200,000)

396,000

1,925,000

1,925,000

1,200,000

3,258,000

15,904,000

Consolidated
Balance
462,000
900,000

3,258,000

6,728,000

7,807,888

644,444
7,807,888

644,444

644,444
16,815,444