On January 1, 2012, Palo Company acquires 80% of the outstanding common stock of Sheila Company for $700,000. On January 1, 2014, Sheila Company sells 25,000 shares of common stock to the public at $12 per share. Palo Company does not purchase any of these shares. No entry has been made by the parent. Sheila Company has the following stockholders’ equity at the end of 2011 and 2013: On the January 1, 2012, acquisition date, Sheila Company’s book values approximate fair values, except for a building that is undervalued by $80,000. The building has an estimated future life of 20 years. Any additional excess is attributed to goodwill. Trial balances of the two companies as of December 31, 2014, are as follows: During 2014, Sheila Company sells $50,000 of merchandise to Palo Company at a price that includes a 20% gross profit. This is their first intercompany sale. $10,000 of the goods remains in Palo’s ending inventory. Required Prepare the worksheet necessary to produce the consolidated financial statements of Palo Company and its subsidiary as of December 31, 2014. Include the determination and distribution of excess and income distribution schedules.
https://affordabletermpapers.com/wp-content/uploads/2021/05/affordable-termpapers.png 0 0 lets https://affordabletermpapers.com/wp-content/uploads/2021/05/affordable-termpapers.png lets2021-02-13 13:30:442021-02-13 13:30:44On January 1, 2012, Palo Company acquires 80% of the outstanding common stock of Sheila Company for.