In: Accounting
The following balance sheets have been prepared on December 31, 2020 for A Corp. and B Inc.
A |
B | |
Cash |
$30,000 |
$20,000 |
Inventory |
$70,000 |
$30,000 |
Accounts Receivable |
$180,000 |
$70,000 |
Investment in Rat |
$200,000 |
|
Fixed Assets |
$500,000 |
$90,000 |
Accumulated Depreciation |
($280,000) |
($30,000) |
Total Assets |
$700,000 |
$180,000 |
Current Liabilities |
$120,000 |
$60,000 |
Long-Term Debt |
$400,000 |
$20,000 |
Common Shares |
$90,000 |
$40,000 |
Retained Earnings |
$90,000 |
$60,000 |
Liabilities and Equity |
$700,000 |
$180,000 |
Balance Sheets
Additional Information:
A uses the cost method to account for its 50% interest in B, which
it acquired on January 1, 2017. On that date, B's retained earnings
were $20,000. The acquisition differential was fully amortized by
the end of 2020.
A sold Land to B during 2019 and recorded a $15,000 gain on the
sale. A is still using this Land. A's December 31, 2020 inventory
contained a profit of $10,000 recorded by B.
B borrowed $20,000 from A during 2020 interest-free. B has not yet
repaid any of its debt to A.
Both companies are subject to a tax rate of 20%.
Prepare a Consolidated Balance Sheet for A on December 31, 2020
assuming that A's investment in B is a control investment.
Can you please show calculations in detail? (Goodwill, RE, NCI and B/S)