Consolidations - Changes in Ownership Interests Bower Corporation purchased a 70
ID: 2599109 • Letter: C
Question
Consolidations - Changes in Ownership Interests Bower Corporation purchased a 70% interest in Stage Corporation on June 1, 2013 at a purchase price of $350,000.On June 1, 2013, the book values of Stage's assets and liabilities were equal to fair values. On June 1, 2013, Stage's stockholders' equity consisted of $290,000 of Common Stock and $210,000 of Retained Earnings. All cost-book differentials were attributed to goodwill. During 2013, Stage earned $120,000 of net income, earned uniformly throughout the year and paid $6,000 of dividends on March 1 and another $6,000 on September 1 uestion 1: Noncontrolling interest share for 2013 is ...? Answer Question 2: Preacquisition income for 2013 is...? Answer Question 3 Anthony Company declared and paid $20,000 of dividends during 2014. The schedule of dividends follows: March 31, 2014 June 30, 2014 September 30, 2014 December 31, 2014 $5,000 $5,000 $5,000 $5,000 Anthony Company was acquired on June 1, 2014 by Google Company. Google acquired 100 percent of Anthony Company. Both companies have a December 31 fiscal year end. What is the amount of preacquisition dividends in 2014? AnswerExplanation / Answer
Total Income Till June July to December Net Income earned 1,20,000 60,000 60,000 Dividned Paid 12,000 6,000 6,000 Earning net of dividend 1,08,000 54,000 54,000 Non controlling Interest for 2013 Common Stock 2,90,000 Retained Earning till June 2,10,000 (Dividend paid in march is already exculded) Earning after June 54,000 5,54,000 Non controlling interest (30% of 554000) 1,66,200 Preacquisition for 2013 54,000 3 Preacquisition Dividend Dividend Declared and paid on March 31,2014 5,000
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