Question

On January 1, 2005, Finch Corporation purchased 75% of the common stock of Grass Co. Separate...

On January 1, 2005, Finch Corporation purchased 75% of the common stock of Grass Co. Separate balance sheet data for the companies at the combination date are given below:       

                                                Finch                                                 Grass              

Cash    $                                  34,000                                $            206,000

Accounts Receivable               144,000                                               26,000

Inventory                                132,000                                               38,000

Land                                        68,000                                                 32,000

Plant assets                              700,000                                               300,000

Accum. Depreciation (           240,000           )                       (           60,000)

Investment in Lapp                 392,000                                  

Total assets     $                      1,230,000                                $          542,000

                                                                       

Accounts payable        $          206,000                                   $          142,000

Capital stock                           800,000                                               300,000

Retained earnings                    224,000                                               100,000

Total liabilities & equities      $1,230,000                              $          542,000

At the date of combination, the book values of Grass’s net assets were equal to the fair value except for Grass’s inventory, which had a fair value of $60,000.

Determine below what the consolidated balance would be for each of the requested accounts.

1.                     What amount of Goodwill will be reported?

                        a.         $10,500.

                        b.         $20,000.

                        c.         $42,000.

                        d.         $75,500.

2.                     What is the reported amount for the non-controlling interest?

3.                     What is the amount of total assets?

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