Consolidation Subsequent to Acquistion

Question 1

Step 1 - Calculate and allocate acquisition differential

Answer 1

Common Shares and Retained Earnings

Allocated as follows:
Assets or Liabilities.

Question 1

Step 2 - Acquisition differential amortization/impairment schedule

Answer 1

Question 2

Step 3 - Identify intercompany receivables and payables.
Step 4 - Identify intercompany revenues and expenses.
Step 5 - Eliminate intercompany profits and related taxes

Answer 2

Question 3

Step 6 - Calculation of consolidated net income

Answer 3

Question 4

Step 7 - Calculate Practice’s share of retained earnings since acquisition

Answer 4

Question 5

Step 8 - Calculate noncontrolling interest for balance sheet

Answer 5

Question 6

Consolidated Income Statement

Answer 6

Question 7

Consolidated Balance Sheet

Answer 7