Following are separate financial statements of Michael Company and Aaron Company as of December 31,...
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Following are separate financial statements of Michael Company and Aaron Company as of December 31, 2015 (credit balances indicated by parentheses). Michael acquired all of Aaron's outstanding voting stock on January 1, 2011, by issuing 20,000 shares of its own $1 par common stock. On the acquisition date, Michael Company's stock actively traded at $23.50 per share. Michael Aaron Company Company 12/31/2015 12/31/2015 (610,000) (370,000) Revenues Cost of goods sold Amortization expense Dividend income Net income 270,00O 115,00O 5,000 230,000 140,000 80,000 150,00O Retained earnings, 1/1/15 Net income (above) Dividends declared Retained earnings, 12/31/15 (880,000 (490,000) (230,00O) (150,000) 5,000 635,000 90,00 (1,020,000 15,000 220,000 280,000 Cash Receivables Inventory Investment in Aaron Compan Copyrights Royalty agreements Total assets 110,00O 380,000 560,00O 470,000 460,000 920,000 340,00O 380,00O 2,900,000 1,235,000 (780,000) (470,000) Liabilities Preferred stock Common stock Additional paid-in capital Retained earnings, 12/31/15 Total liabilities and equity (300,00o) (500,00O) (100,000) (300,000) (30,000) 635,000 (1,020,000 (2,900,000) (1,235,000)
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