The following comparative consolidated trial balances apply to Perella Company and its subsidiary Sherwood Company (80% control):
The following is additional information for 20X5:
a)No trading securities were sold nor were any investments added to the portfolio.
b)Land was acquired by issuing a $40,000 note and giving cash for the balance.
c)Equipment (cost $50,000; accumulated depreciation $40,000) was sold for $3,000
d)Dividends declared and paid: Perella 50,000; Sherwood $40,000.
e)Consolidated net income amounted to $178,900.
Required:
Prepare the consolidated statement of cash flows for the year ended December 31, 20X5, for Perella and its subsidiary.

Question

The following comparative consolidated trial balances apply to Perella Company and its subsidiary Sherwood Company (80% control):
  The following is additional information for 20X5:
a)No trading securities were sold nor were any investments added to the portfolio.
b)Land was acquired by issuing a $40,000 note and giving cash for the balance.
c)Equipment (cost $50,000; accumulated depreciation $40,000) was sold for $3,000
d)Dividends declared and paid: Perella 50,000; Sherwood $40,000.
e)Consolidated net income amounted to $178,900.
Required:
Prepare the consolidated statement of cash flows for the year ended December 31, 20X5, for Perella and its subsidiary.

Quizplus · Accepted Answer

The Answer of The following comparative consolidated trial balances apply to Perella Company and its subsidiary Sherwood Company (80% control):
  The following is additional information for 20X5:
a)No trading securities were sold nor were any investments added to the portfolio.
b)Land was acquired by issuing a $40,000 note and giving cash for the balance.
c)Equipment (cost $50,000; accumulated depreciation $40,000) was sold for $3,000
d)Dividends declared and paid: Perella 50,000; Sherwood $40,000.
e)Consolidated net income amounted to $178,900.
Required:
Prepare the consolidated statement of cash flows for the year ended December 31, 20X5, for Perella and its subsidiary.

The Following Comparative Consolidated Trial Balances Apply to Perella Company