December 31 2014 trial balances for Pledge Company and

its #6345
December 31, 2014, trial balances for Pledge Company and its subsidiary Stom Company
follow:Pledge Company purchased 72,000 shares of Stom Company's common stock on
January 1, 2011, for $300,000.On that date, Stom Company's stockholders' equity was as
follows: Common Stock, $1 par value ...............$100,000Other Contributed Capital
.....................80,000Retained Earnings ..............................160,000Treasury Stock (10,000
shares at cost) .....(20,000)Total ............................................$320,000Additional information:1.
Receivables of Pledge Company include a $55,000, 12% note receivable from Stom
Company.2. Interest amounting to $6,600 has been accrued by each company on the note
payable from Stom to Pledge. Stom Company has not yet paid this interest.3. The difference
between book value and the value implied by the purchase price relates to subsidiary land.
Required:Prepare a consolidated statements work paper for the year ended December 31,
2014.View Solution:
December 31 2014 trial balances for Pledge Company and its

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