Question

Following are financial statements for Moore Company and Kirby Company for 2018: $ Kirby (600,000) 400,000 160,000 (40,000) (550,000) (40,000) $ $ Sales Cost of goods sold Operating and interest expenses Net income Retained earnings, 1/1/18 Net income Dividends declared Retained earnings, 12/31/18 Cash and receivables Inventory Investment in Kirby Equipment (net) Buildings Accumulated depreciation—buildings Other assets Total assets Liabilities Common stock Retained earnings, 12/31/18 Total liabilities and equity Moore $ (800,000) 500,000 100,000 $ (200,000) $ (990,000) (200,000) 130,000 $ (1,060,000) 217,000 224,000 657,000 600.000 1,000,000 (100,000) 200,000 $ 2,798,000 $ (1,138,000) (600,000) (1,060,000) $ (2,798,000) (590,000) 180,000 160,000 420,000 650,000 (200,000) 100,000 $ 1,310,000 $ (570,000) (150,000) (590,000) $ (1,310,000)

Answer 1

	Particulars	Amount ($)
	Sales	1240000
	Cost of good sold (W.N 1)	744100
	Operating and interest expense	275000
	Non controlling interest in consolidated net income (W.N 2)	1790
	Consolidated net income	220900
	Consolidated net income to controlling interest (W.N 3)	219110
	Retained earnings , 1/1/18	1025970
	Dividend declared	130000
	Retained earnings , 12/31/18	1115080
	Cash and receivables	397000
	Inventory	371200
	Investment in Kirby	0
	Equipment (net)	1030000
	Building	1725000
	Accumulated Depreciation	384000
	Other assets	300000
	Brand names	40000
	Total Assets	3479200
	Liabilities	1684000
	NCI	80120
	Common stock	600000
	Retained earnings , 12/31/18	1115080
	Total Liability and equity	3479200
	Working note :
1	Particulars	Amount ($)
	Cost of good sold
	Moore's book value	500000
	kirby's book value	400000
	Eliminate intercompany transfer	-160000
	Realized gross profit deferred in 2017	-8700
	Deferral of 2018 unrealized gross profit	12800
	Cost of good sold	744100
2	Particulars	Amount ($)
	Reported income	40000
	Realized gross profit deferred in 2017	8700
	Deferral of 2018 unrealized gross profit	-12800
	Realized income of subsidiary	35900
	Excess fair value of amortization	-18000
	Adjusted subsidiary net income	17900
	Outside ownership	10%
	Non controlling interest	1790
3	Particulars	Amount ($)
	Consolidated net income	220900
	Non controlling interest	1790
	controlling interest	219110