Alford Company and its 80 percent-owned subsidiary, Knight, have the following income statements for 2011:
| Alford | Knight |
Revenues | $(500,000) | $(230,000) |
Cost of goods sold | 300,000 | 140,000 |
Depreciation and amortization | 40,000 | 10,000 |
Other expenses | 20,000 | 20,000 |
Gain on sale of equipment | (30,000) | –0– |
Equity in earnings of Knight | (36,200) | –0– |
Net income | $(206,200) | $ (60,000) |
Additional Information for 2011
• Intra-entity inventory transfers during the year amounted to $90,000 and were downstream from Alford to Knight.
• Unrealized inventory gains at January 1 were $6,000, but at December 31, they are $9,000.
• Annual excess amortization expense resulting from the acquisition is $11,000.
• Knight paid dividends totaling $20,000.
• The noncontrolling interest’s share of the subsidiary’s income is $9,800.
• During the year, consolidated inventory rose by $11,000 while accounts receivable and accounts payable declined by $8,000 and $6,000, respectively.
Using either the direct or the indirect approach, determine the amount of cash generated from operations during the period by this business combination.
We need at least 9 more requests to produce the solution.
1 / 10 have requested this problem solution
The more requests, the faster the answer.