NAMA : Resky Awaliah

NIM : A031181004

UJIAN TENGAH SEMESTER

MATA KULIAH “AKUNTANSI KEUANGAN LANJUTAN 2”

P5-7

Preliminary computations
Investment cost $2,700,000
Implied fair value of San $3,000,000
Less: Book value of San 2,500,000
Patents $ 500,000
Patent amortization $500,000/10 years = $50,000 per year

Upstream sales
31, 2011 inventory of Pol
Unrealized profit in December
$280,000 - ($280,000 ¸ 1.4) = $80,000
Unrealized profit in December 31, 2012 inventory of Pol
$420,000 - ($420,000 ¸ 1.4) = $120,000

Income from San

$1,000,000
San's reported net income
Less: Patent amortization (50,000)
Less: Unrealized profit in ending inventory (120,000)
Add: Unrealized profit in beginning inventory 80,000
San’s adjusted and realized income $ 910,000
Pol’s 90% controlling share of San’s income $ 819,000
10% noncontrolling interest share of San’s income $ 91,000

Investment balance
$ 2,700,000
Initial investment cost
Increase in San's net assets from December 31, 2010
to December 31, 2012 ($700,000 ´ 90%) 630,000
Patent amortization for 2 years (90%) ( 90,000)
Unrealized profit in December 31, 2012 inventory (108,000)
Investment balance December 31, 2012 $ 3,132,000
 Pol Corporation and Subsidiary
Consolidation Workpapers
for the year ended December 31, 2012
(in thousands)

Adjustments and Consolidated

Pol San 90% Eliminations Statements
Income Statement
Sales $8,190 $5,600 a 5,600 $ 8,190
Income from San 819 d 819
Cost of sales 5,460* 4,000* b 120 a 5,600 3,900*
c 80
Other expenses 1,544* 600* f 50 2,194*
Consolidated net income $ 2,096
Noncontrolling int.share h 91 91*
Controlling share of NI $ 2,005 $1,000 $ 2,005

Retained Earnings
Retained earnings — Pol $ 1,200 $ 1,200
Retained earnings — San $ 700 e 700
Controlling share of NI 2,005ü 1,000ü 2,005
Dividends 1,000* 500* d 450
h 50 1,000*
Retained earnings
December 31 $ 2,205 $1,200 $ 2,205

Balance Sheet
Cash $ 753 $ 500 $ 1,253
Inventory 420 800 b 120 1,100
Other current assets 600 200 g 100 700
Plant assets — net 3,000 3,000 6,000
Investment in San 3,132 c 72 d 369
e 2,835
Patents e 450 f 50 400
$7,905 $4,500 $ 9,453

Current liabilities $ 1,700 $1,300 g 100 $ 2,900

Capital stock 4,000 2,000 e 2,000 4,000
Retained earnings 2,205 1,200 2,205
$ 7,905 $4,500

Noncontrolling interest January 1 c 8 e 315

Noncontrolling interest December 31 h 41 348
$ 9,453
* Deduc