The following are selected account balances from Penske Company and Stanza Corporation as of December 31, 2021: Revenues Cost of goods sold Depreciation expense Investment income Dividends declared Retained earnings, 1/1/21 Current assets Copyrights Royalty agreements Investment in Stanza Liabilities Penske $ (742,000) 264,700 187,000 Not given 80,000 (788,000) 498,000 990,000 772,000 Not given (600,000) (600,000) ($20 par) (150,000) Common stock Additional paid-in capital Note: Parentheses indicate a credit balance. $ Stanza (652,000) 163,000 224,000 0 60,000 (330,000) 598,000 384,000 1,190,000 0 (1,357,000) (200,000) ($10 par) (80,000) On January 1, 2021, Penske acquired all of Stanza's outstanding stock for $829,000 fair value in cash and common stock. Penske also paid $10,000 in stock issuance costs. At the date of acquisition, copyrights (with a six-year remaining life) have a $456,000 book value but a fair value of $660,000. a. As of December 31, 2021, what is the consolidated copyrights balance? . For the year ending December 31, 2021, what is consolidated net income? c. As of December 31, 2021, what is the consolidated retained earnings balance? d. As of December 31, 2021, what is the consolidated balance to be reported for goodwill?
The following are selected account balances from Penske Company and Stanza Corporation as of December 31, 2021: Revenues Cost of goods sold Depreciation expense Investment income Dividends declared Retained earnings, 1/1/21 Current assets Copyrights Royalty agreements Investment in Stanza Liabilities Penske $ (742,000) 264,700 187,000 Not given 80,000 (788,000) 498,000 990,000 772,000 Not given (600,000) (600,000) ($20 par) (150,000) Common stock Additional paid-in capital Note: Parentheses indicate a credit balance. $ Stanza (652,000) 163,000 224,000 0 60,000 (330,000) 598,000 384,000 1,190,000 0 (1,357,000) (200,000) ($10 par) (80,000) On January 1, 2021, Penske acquired all of Stanza's outstanding stock for $829,000 fair value in cash and common stock. Penske also paid $10,000 in stock issuance costs. At the date of acquisition, copyrights (with a six-year remaining life) have a $456,000 book value but a fair value of $660,000. a. As of December 31, 2021, what is the consolidated copyrights balance? . For the year ending December 31, 2021, what is consolidated net income? c. As of December 31, 2021, what is the consolidated retained earnings balance? d. As of December 31, 2021, what is the consolidated balance to be reported for goodwill?
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter15: Financial Statement Analysis
Section: Chapter Questions
Problem 6MCQ
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