Chariot company acquired, Chariot Company acquired 100

Chariot company acquired

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Reference no: EM13966059

On January 1, 20X8, Chariot Company acquired 100 percent of Stryder Company for $220,000 cash. The trial balances for the two companies on December 31, 20X8, included the following amounts:

CHARIOT:

Cash $50,000,

Accounts Receivable $60,000,

Inventory $75,000,

Land $60,000,

Buildings and Equipment $300,000,

Investment in Stryder $256,000,

Cost of Goods Sold $270,000,

Depreciation Expense $30,000,

Other Expenses $80,000,

Dividends Declared $40,000,

Accumulated Depreciation $120,000,

Accounts Payable $50,000,

Mortgage Payable $100,000,

Common Stock $200,000,

Retained Earnings $200,000,

Sales $500,000,

Income from Subsidiary $51,000.

STRYDER:

Cash $30,000,

Accounts Receivable $40,000,

Inventory $80,000,

Land $40,000,

Buildings and Equipment $120,000,

Cost of Goods Sold $170,000,

Depreciation Expense $12,000,

Other Expenses $63,000,

Dividends Declared $15,000,

Accumulated Depreciation $48,000,

Accounts Payable $27,000,

Mortgage Payable $25,000,

Common Stock $100,000,

Retained Earnings $70,000,

Sales $300,000.

On the acquisition date, Stryder reported net assets with a book value of $170,000. A total of $10,000 of the acquisition price is applied to goodwill, which was not impaired in 20X8. Stryder's depreciable assets had an estimated economic life of 10 years on the date of combination. The difference between fair value and book value of tangible assets is related entirely to buildings and equipment. Chariot used the equity method in accounting for its investment in Stryder. Analysis of receivables and payables revealed that Stryder owed Chariot $10,000 on December 31, 20X8. 27. Based on the information provided, what amount of retained earnings will be reported in the consolidated financial statements for the year?

Reference no: EM13966059

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