On January 1, 2019, Perry Company purchased 8,000 shares of Soho Company’s common stock for

$120,000. Immediately after the stock acquisition, the statements of financial position of Perry and Soho
appeared as follows:
Perry Soho
Cash $ 39,000 $ 19,000
Account receivable (net) 53,000 31,000
Inventory 42,000 25,000
Investment in Soho Company 120,000
Plant assets 160,000 110,500
Accumulated depreciation-plan assets (52,000) (19,500)
Total assets $ 362,000 $ 166,000
Current liabilities $ 18,500 $ 26,000
Mortage notes payable 40,000
Common stock, $10 par value 120,000 100,000
Other contributed capital 135,000 16,500
Retained earnings 48,500 23,500
Total $ 362,000 $ 166,000

A. Calculate the percentage of Soho acquired by Perry Company.

investment shares = 100,000/$10
= 10,000
percentage = 8,000/10,000
= 80%

B. Prepare a consolidated balance sheet workpaper as of January 1, 2019.

P Share Non Controlling Total Value
Purchase price & implied value 120,000 30,000 150,000
Less: BV of subsidiary equity
Common Stock 80,000 20,000 100,000
Other Contributed Capital 13,200 3,300 16,500
Retained Earning 18,800 4,700 23,500
Total BV 112,000 28,000 140,000
Difference between IV&BV 8,000 2,000 10,000
PPE (8,000) (2,000) (10,000)
Balance - - -

Journal:
Common Stock 100,000
Other Contributed Capital 16,500
Retained Earnings 23,500
Difference between IV & BV 10,000
Investment in S 120,000
NCI 30,000

PPE 10,000
 Dfference between IV & BV 10,000

Consolidated Balance Sheet Workpaper

Prunce Company & Subsidiary
January 1 2019
Asset: P Comp S Comp Debit Credit NCI Consolidated
Cash 39,000 19,000 58,000
A/R 53,000 31,000 84,000
Inventory 42,000 25,000 67,000
Investment 120,000 120,000 0
PPE 160,000 110,500 10,000 280,500
Acc Dep (52,000) (19,500) (71,500)
Difference 10,000 10,000 0
Total Asset 362,000 166,000 20,000 130,000 418,000

Liabilities:
Current Liabilities 18,500 26,000 44,500
Mortage Payable 40,000 40,000
Common Stock
P Comp 120,000 120,000
S Comp 100,000 100,000 0
OCC
P Comp 135,000 135,000
S Comp 16,500 16,500 0
R/E
P Comp 48,500 48,500
S Comp 23,500 23,500 0
NCI 30,000 30,000
Total Liab & Equity 362,000 166,000 140,000 30,000 418,000