Consolidated balance sheet work papers (excess allocated to equipment and goodwill)
Pan Corporation purchased 90 percent of Son Corporation’s outstanding stock for $7,200,000 cash on January 1, 2011, when Son’s stockholders’ equity consisted of $4,000,000 capital stock and $1,400,000 retained earnings. The excess was allocated $1,600,000 to undervalued equipment with an eight year remaining useful life and $1,000,000 to goodwill. Son’s net income and dividends for 2011 were $1,000,000 and $400,000, respectively. Comparative balance sheet data for Pan and Son Corporations at December 31, 2011, are as follows (in thousands):
|
Pan |
Son |
|
|
Cash |
$ 600 |
$ 400 |
|
Receivables—net |
1,200 |
800 |
|
Dividends receivable |
180 |
— |
|
Inventory |
1,400 |
1,200 |
|
Land |
1,200 |
1,400 |
|
Buildings—net |
4,000 |
2,000 |
|
Equipment—net |
3,000 |
1,600 |
|
Investment in Son |
7,560 |
— |
|
$19,140 |
$7,400 |
|
|
Accounts payable |
$ 600 |
$1,200 |
|
Dividends payable |
1,000 |
200 |
|
Capital stock |
14,000 |
4,000 |
|
Retained earnings |
3,540 |
2,000 |
|
$19,140 |
$7,400 |
REQUIRED: Prepare consolidated balance sheet work papers for Pan Corporation and Subsidiary on December 31, 2011.