Consolidated Statement of Financial Po


1. The balance sheets of ParentCo Corp. and SubCo Ltd on December 30, Year-5 were as follows:

On December 31, Year-5, ParentCo purchased 80% of the outstanding shares of SubCo for $88,000. Legal fees involved with the acquisition were an additional $6,000. In addition to the assets identified above, SubCo also owns a previously unidentified patent valued at $10,000.


Prepare the consolidated balance sheet at the date of acquisition, December 31, Year-5, under the Identifiable net asset (INA) method.
Calculate NCI on the consolidated statement of financial position at December 31, Year-5, under the Fair Value Enterprise (FVE) Method.

2. A Ltd acquired an 80% interest in B Corp. on December 31, Year-2 for $500,000. On that date B. Corp had $450,000 in common shares and retained earnings of $125,000. On that date, the inventory was undervalued by $75,000 and patents with a remaining life of 5 years were overvalued by 95,000. A dividend of $10,000 was declared in Year-3 and $12,000 in Year-4. A test for goodwill impairment on December 31, Year-4 indicated a loss of $20,000, which should be reported on the Year-4 financial statements.

A Ltd, which uses the cost method, reported a profit of $35,000 in Year-3 and a loss of $15,000 in Year-4. A’s retained earnings on December 31, Year-4 were $100,000.


Consolidated profit attributed to A’s shareholder for Year-4
Consolidated retained earnings for Year-4 (Dec 31, Year-4)
Non-Controlling interest in the balance sheet for Year-4 (December 31, Year-4)

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