ProForm acquired 70 percent of ClipRite on June 30, 2017, for$980,000 in cash. Based on ClipRite's acquisition-date fair value,an unrecorded intangible of $600,000 was recognized and is beingamortized at the rate of $15,000 per year. No goodwill wasrecognized in the acquisition. The noncontrolling interest fairvalue was assessed at $420,000 at the acquisition date. The 2018financial statements are as follows:
| | ProForm | | | | ClipRite | |
| Sales | $ | (850,000 | ) | | $ | (700,000 | ) |
| Cost of goods sold | | 560,000 | | | | 425,000 | |
| Operating expenses | | 150,000 | | | | 125,000 | |
| Dividend income | | (70,000 | ) | | | 0 | |
| Net income | $ | (210,000 | ) | | $ | (150,000 | ) |
| Retained earnings, 1/1/18 | $ | (1,400,000 | ) | | $ | (900,000 | ) |
| Net income | | (210,000 | ) | | | (150,000 | ) |
| Dividends declared | | 150,000 | | | | 100,000 | |
| Retained earnings, 12/31/18 | $ | (1,460,000 | ) | | $ | (950,000 | ) |
| Cash and receivables | $ | 450,000 | | | $ | 350,000 | |
| Inventory | | 340,000 | | | | 750,000 | |
| Investment in ClipRite | | 980,000 | | | | 0 | |
| Fixed assets | | 1,500,000 | | | | 850,000 | |
| Accumulated depreciation | | (600,000 | ) | | | (300,000 | ) |
| Totals | $ | 2,670,000 | | | $ | 1,650,000 | |
| Liabilities | $ | (610,000 | ) | | $ | (100,000 | ) |
| Common stock | | (600,000 | ) | | | (600,000 | ) |
| Retained earnings, 12/31/18 | | (1,460,000 | ) | | | (950,000 | ) |
| Totals | $ | (2,670,000 | ) | | $ | (1,650,000 | ) |
|
ProForm sold ClipRite inventory costing $74,000 during the lastsix months of 2017 for $140,000. At year-end, 30 percent remained.ProForm sells ClipRite inventory costing $225,000 during 2018 for$300,000. At year-end, 10 percent is left.
Determine the consolidated balances for the followingaccounts:
sales:
cogs:
operating expenses:
dividend income:
net income attributable to noncontrolling interest
inventory
noncontrolling interest in subsidiary on 12/31/18:
