Question
In: Accounting
The following separate income statements are for Burks Company and its 80 percent–owned subsidiary, Foreman Company:...
The following separate income statements are for Burks Company and its 80 percent–owned subsidiary, Foreman Company:
| Burks | Foreman | |||||||
| Revenues | $ | (420,000 | ) | $ | (320,000 | ) | ||
| Expenses | 344,000 | 235,000 | ||||||
| Gain on sale of equipment | 0 | (25,000 | ) | |||||
| Equity earnings of subsidiary | (62,000 | ) | 0 | |||||
| Net income | $ | (138,000 | ) | $ | (110,000 | ) | ||
| Outstanding common shares | 60,000 | 30,000 | ||||||
|
Additional Information Amortization expense resulting from Foreman’s excess acquisition-date fair value is $35,000 per year. Burks has convertible preferred stock outstanding. Each of these 8,000 shares is paid a dividend of $2 per year. Each share can be converted into two shares of common stock. Stock warrants to buy 20,000 shares of Foreman are also outstanding. For $15, each warrant can be converted into a share of Foreman’s common stock. The fair value of this stock is $20 throughout the year. Burks owns none of these warrants. Foreman has convertible bonds payable that paid interest of $40,000 (after taxes) during the year. These bonds can be exchanged for 11,000 shares of common stock. Burks holds 16 percent of these bonds, which it bought at book value directly from Foreman. Compute basic and diluted EPS for Burks Company. *Round to two decimal places* |
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Solutions
ekkarill92 answered 2 years agoRelated Solutions
The following separate income statements are for Burks Company and its 80 percent–owned subsidiary, Foreman Company:
The following separate income statements are for Burks Company
and its 80 percent–owned subsidiary, Foreman Company:BurksForemanRevenues$(422,000)$(322,000)Expenses373,000236,000Gain on sale of equipment0(26,000)Equity earnings of
subsidiary(63,000)0Net income$(112,000)$(112,000)Outstanding common shares60,00033,000Additional InformationAmortization expense resulting from Foreman’s excess
acquisition-date fair value is $36,000 per year.Burks has convertible preferred stock outstanding. Each of these
6,000 shares is paid a dividend of $4 per year. Each share can be
converted into four shares of common stock.Stock warrants to buy 14,000 shares of Foreman are also
outstanding. For $10,...
The following separate income statements are for Burks Company and its 80 percent–owned subsidiary, Foreman Company:...
The following separate income statements are for Burks Company
and its 80 percent–owned subsidiary, Foreman Company: Burks Foreman
Revenues $ (448,000 ) $ (348,000 ) Expenses 273,000 249,000 Gain on
sale of equipment 0 (39,000 ) Equity earnings of subsidiary (73,000
) 0 Net income $ (248,000 ) $ (138,000 ) Outstanding common shares
60,000 40,000
Additional Information Amortization expense resulting from
Foreman’s excess acquisition-date fair value is $49,000 per year.
Burks has convertible preferred stock outstanding. Each of these...
The following separate income statements are for Burks Company and its 80 percent–owned subsidiary, Foreman Company:...
The following separate income statements are for Burks Company
and its 80 percent–owned subsidiary, Foreman Company:
Burks
Foreman
Revenues
$
(438,000
)
$
(338,000
)
Expenses
270,000
244,000
Gain on sale of equipment
0
(34,000
)
Equity earnings of
subsidiary
(68,000
)
0
Net income
$
(236,000
)
$
(128,000
)
Outstanding common shares
65,000
40,000
Additional Information
Amortization expense resulting from Foreman’s excess
acquisition-date fair value is $41,000 per year.
Burks has convertible preferred stock outstanding. Each of these...
The following separate income statements are for Burks Company and its 80 percent–owned subsidiary, Foreman Company:...
The following separate income statements are for Burks Company
and its 80 percent–owned subsidiary, Foreman Company:
Burks
Foreman
Revenues
$
(400,000
)
$
(328,000
)
Expenses
220,000
239,000
Gain on sale of equipment
0
(29,000
)
Equity earnings of subsidiary
(66,000
)
0
Net income
$
(246,000
)
$
(118,000
)
Outstanding common shares
70,000
36,000
Additional Information
Amortization expense resulting from Foreman’s excess
acquisition-date fair value is $34,000 per year.
Burks has convertible preferred stock outstanding. Each of
these...
Following are separate income statements for Austin, Inc., and its 80 percent owned subsidiary, Rio Grande...
Following are separate income statements for Austin, Inc., and
its 80 percent owned subsidiary, Rio Grande Corporation as well as
a consolidated statement for the business combination as a
whole.
Austin
Rio Grande
Consolidated
Revenues
$
(760,000
)
$
(540,000
)
$
(1,300,000
)
Cost of goods sold
420,000
320,000
740,000
Operating expenses
120,000
66,000
215,000
Equity in earnings of Rio
Grande
(104,000
)
Individual company net
income
$
(324,000
)
$
(154,000
)
Consolidated net income
$
(345,000
)...
Following are separate income statements for Austin, Inc., and its 80 percent owned subsidiary, Rio Grande...
Following are separate income statements for Austin, Inc., and
its 80 percent owned subsidiary, Rio Grande Corporation as well as
a consolidated statement for the business combination as a
whole.
Austin
Rio Grande
Consolidated
Revenues
$
(739,000
)
$
(526,000
)
$
(1,265,000
)
Cost of goods sold
413,000
313,000
726,000
Operating expenses
114,000
83,000
235,000
Equity in earnings of Rio Grande
(70,000
)
Individual company net income
$
(282,000
)
$
(130,000
)
Consolidated net income
$
(304,000
)...
Following are separate income statements for Austin, Inc., and its 80 percent–owned subsidiary, Rio Grande Corporation...
Following are separate income statements for Austin, Inc., and
its 80 percent–owned subsidiary, Rio Grande Corporation as well as
a consolidated statement for the business combination as a whole
(credit balances indicated by parentheses).
Austin
Rio Grande
Consolidated
Revenues
$
(738,000
)
$
(538,000
)
$
(1,276,000
)
Cost of goods sold
438,000
262,000
700,000
Operating expenses
138,000
108,000
271,000
Equity in earnings of Rio Grande
(114,400
)
Individual company net income
$
(276,400
)
$
(168,000
)
Consolidated net...
Following are separate income statements for Austin, Inc., and its 80 percent–owned subsidiary, Rio Grande Corporation...
Following are separate income statements for Austin, Inc., and
its 80 percent–owned subsidiary, Rio Grande Corporation as well as
a consolidated statement for the business combination as a whole
(credit balances indicated by parentheses).
Austin
Rio Grande
Consolidated
Revenues
$
(726,000
)
$
(526,000
)
$
(1,252,000
)
Cost of goods sold
426,000
274,000
700,000
Operating expenses
126,000
96,000
247,000
Equity in earnings of Rio Grande
(104,800
)
Individual company net income
$
(278,800
)
$
(156,000
)
Consolidated net...
Alford Company and its 80 percent–owned subsidiary, Knight, have the following income statements for 2018: Alford...
Alford Company and its 80 percent–owned subsidiary, Knight, have
the following income statements for 2018: 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 2018 Intra-entity inventory transfers
during the year amounted to $90,000. All intra-entity transfers
were...
Separate income statements of quail corp and its 80% owned subsidiary, Savannah corp, for 2016 are...
Separate income statements of quail corp and its 80% owned
subsidiary, Savannah corp, for 2016 are as follows:
Quail Savannah
sales rev 800,000 300,000
gain on equipment 35,000
cost of sales (400000) (160000)
other expenses (265000) (60000)
separate incomes 135000 115000
addiitonal information:
1. quail acquired its 80% interest in savannah corporation when
the book values were equal to the fair values.
2. the gain on equipment relates to eqiupment with a book value
of 85000 and a 7yr remaining...
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