Herbert Inc, acquired all of Rambis Company's outstanding stock on January 1, 2020 for $592,000 in cash. Annual excess amortization of $15.700 results from thes transaction. On the date of the takeover, Herbert reported retained earnings of $408,000, and Rambis reported a $205,000 balance Herbert reported internal net income of $45,000 in 2020 and $58,700 in 2021 and declared $10,000 in dividends each year Rambas reported net income of $25,900 in 2020 and $39600 in 2021 and declared $5,000 in dividends each year
a. Assume that Herbert's internal net income figures above do not include any income from the subsidiary
if the parent uses the equity method, what is the amount reported as consolidated retained earnings on December 31, 20217
What would be the amount of consolidated retained earnings on December 31, 2021, if the parent had applied either the initial
Value or partial equity method for internal accounting purposes?
b. Under each of the following situations, what is the Investment in Raimbis account balance on Herbert's books on January 1, 2021
The parent uses the equity method
The parent uses the partial equity method.
The parent uses the initial value method
c. Under each of the following situations, what is Entry °C on a 2021 consolidation worksheet?
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The parent uses the equity method. The parent uses the partial equity method The parent uses the initial value method
