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In: Accounting

The trial balances of Charles Company and its subsidiary, Letho, Inc., are as follows on December...

The trial balances of Charles Company and its subsidiary, Letho, Inc., are as follows on December 31, 2017:

Charles Lehto

Current Assets...................................................... 590,000 130,000

Depreciable Fixed Assets.................................... 1,805,000 440,000

Accumulated Depreciation.................................... (405,000) (70,000)

Investment in Lehto, Inc........................................ 400,000

Liabilities .............................................................. (900,000) (225,000)

Common stock ($1 par) ....................................... (200,000)

Common Stock ($5 Par)........................................ (50,000)

Paid in Capital in Excess of par............................. (1,040,000) (15,000)

Retained Earnings, January 1, 2013...................... (230,0000 (170,000)

Revenues............................................................... (460,000) (210,000)

Expenses................................................................ 450,000 170,000

Dividends Declared................................................... 10,000

Totals.............................................................. 0 0

On January 1, 2015 Charles Company exchanges 20,000 shares of its common stock, with a fair value of $20 per share, for all the outstanding stock of Lehto, Inc. Fixed assets with 10-year life understated by 50,000. Any excess of cost over book value is attributed to goodwill. The stockholders' equity of Lehto, Inc., on purchase date is as follows:

Common stock ($5 par)....................................... $ 50,000

Paid-in capital in excess of par............................ 15,000

Retained earnings................................................. 135,000

Total equity..................................................... $200,000

1) Complete determination and distribution of excess schedule for investment and value analysis schedule

2) prepare the 2013 consolidated statements, including the income statement, retained earnings statement, and balance sheet

Using Excel and include a consolidated Worksheet.

You should have J/E's CY1, CY2, EL, D and A. Also a financial statement that is the Consolidated Income Statement and then Income Distribution.

Expert Solution

Answer:

ekkarill92 answered 2 years ago

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