On January 1, 2016, Prange Company acquired 100% of the common stock of Seaman Company for $600,000.On this date Seaman had total owners' equity of $400,000.Any excess of cost over book value is attributable to a patent, which is to be amortized over 10 years.
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During 2016 and 2017, Prange has appropriately accounted for its investment in Seaman using the simple equity method.
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On January 1, 2017, Prange held merchandise acquired from Seaman for $30,000.During 2017, Seaman sold merchandise to Prange for $100,000, of which $20,000 is held by Prange on December 31, 2017.Seaman's gross profit on all sales is 40%.
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On December 31, 2017, Prange still owes Seaman $20,000 for merchandise acquired in December.
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Required:
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Complete the Figure 4-1 worksheet for consolidated financial statements for the year ended December 31, 2017.
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?
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Question

On January 1, 2016, Prange Company acquired 100% of the common stock of Seaman Company for $600,000.On this date Seaman had total owners' equity of $400,000.Any excess of cost over book value is attributable to a patent, which is to be amortized over 10 years.
?
During 2016 and 2017, Prange has appropriately accounted for its investment in Seaman using the simple equity method.
?
On January 1, 2017, Prange held merchandise acquired from Seaman for $30,000.During 2017, Seaman sold merchandise to Prange for $100,000, of which $20,000 is held by Prange on December 31, 2017.Seaman's gross profit on all sales is 40%.
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On December 31, 2017, Prange still owes Seaman $20,000 for merchandise acquired in December.
?
Required:
?
Complete the Figure 4-1 worksheet for consolidated financial statements for the year ended December 31, 2017.
?
?
  ?

Quizplus · Accepted Answer

The Answer of On January 1, 2016, Prange Company acquired 100% of the common stock of Seaman Company for $600,000.On this date Seaman had total owners' equity of $400,000.Any excess of cost over book value is attributable to a patent, which is to be amortized over 10 years.
?
During 2016 and 2017, Prange has appropriately accounted for its investment in Seaman using the simple equity method.
?
On January 1, 2017, Prange held merchandise acquired from Seaman for $30,000.During 2017, Seaman sold merchandise to Prange for $100,000, of which $20,000 is held by Prange on December 31, 2017.Seaman's gross profit on all sales is 40%.
?
On December 31, 2017, Prange still owes Seaman $20,000 for merchandise acquired in December.
?
Required:
?
Complete the Figure 4-1 worksheet for consolidated financial statements for the year ended December 31, 2017.
?
?
  ?

On January 1, 2016, Prange Company Acquired 100% of the Common