The Financial Statements of Plax Inc

question 57

Essay

The Financial Statements of Plax Inc. and Slate Corp for the Year ended December 31, 2012 chapters) Other Information:
▪Plax acquired 75% of Slate on January 1, 2008 for $196,000, when Slate's retained earnings was $80,000 and the acquisition differential was attributable entirely to goodwill. There were impairment losses to the goodwill of $6,400 and $1,600 in 2009 and 2012 respectively.
▪Plax uses the cost method to account for its investment.
▪Slate has 10% par value bonds outstanding in the amount of $200,000 which mature on December 31, 2015. The bonds were issued at a premium. On January 1, 2012 the unamortized premium amounted to $2,400 Slate uses the straight line method to amortize the premium.
▪On January 1, 2012, Plax acquired $120,000 face value of Slate's bonds for $123,000 Plax also uses the straight line method to amortize any bond premium or discount.
▪Both companies are subject to a 40% Tax rate.
▪Gains and losses from intercompany bond holdings are to be allocated to the two companies when Consolidated Financial Statements are prepared. Prepare a Statement of Consolidated Retained Earnings for the year ended December 31, 2012 for Plax Inc.

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Definitions:

Plan Of Action

A detailed strategy or course of actions designed to achieve a specific goal or objective.

SOAP Format

A standardized method for documenting medical information, standing for Subjective, Objective, Assessment, Plan.

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A type of medical record keeping where information is organized according to the source that provided the information, such as lab reports, radiology, and physician notes, kept in separate sections.

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