Allen Co Held 80% of the Common Stock of Brewer Inc

question 57

Essay

Allen Co. held 80% of the common stock of Brewer Inc. and 40% of this subsidiary's convertible bonds. The following consolidated financial statements were for 2020 and 2021.
Additional Information:Bonds were issued during 2021 by the parent for cash.Amortization of a database acquired in the original combination amounted to $7,000 per year.A building with a cost of $84,000 but a $42,000 book value was sold by the parent for cash on May 11, 2021.Equipment was purchased by the subsidiary on July 23, 2021, using cash.Late in November 2021, the parent issued common stock for cash.During 2021, the subsidiary paid dividends of $14,000.Required:Prepare a consolidated statement of cash flows for this business combination for the year ending December 31, 2021. Either the direct method or the indirect method may be used.

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Definitions:

Swishing Sound

Often related to the auditory phenomenon produced by the movement of liquid or air, typically associated with certain medical conditions or physiological activities.

Valvular Disorder

A medical condition affecting the heart valves’ ability to open and close properly, impacting blood flow.

SA Node

The sinoatrial node, often regarded as the heart's natural pacemaker, initiates electrical impulses that determine the heart rate.

AV Node

The Atrioventricular Node, a critical component of the heart's electrical system, responsible for controlling the timing of heart muscle contractions.