Refer to the Information Below and Worksheet 3-1 $$\begin{array} { l r r } & 2016 & 2017 \\\text { Netincome } & \$ 50,000 & \$ 90,000 \\\text { Dividends } & 10,000 & 20,000\end{array}$$

question 13

Essay

Refer to the information below and Worksheet 3-1.
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On January 1, 2016, Parent Company purchased 80% of the common stock of Subsidiary Company for $316,000.On this date, Subsidiary had common stock, other paid-in capital, and retained earnings of $40,000, $120,000, and $190,000, respectively.Net income and dividends for 2 years for Subsidiary Company were as follows:
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$$\begin{array} { l r r } & 2016 & 2017 \\\text { Netincome } & \$ 50,000 & \$ 90,000 \\\text { Dividends } & 10,000 & 20,000\end{array}$$ On January 1, 2016, the only tangible assets of Subsidiary that were undervalued were inventory and building.Inventory, for which FIFO is used, was worth $5,000 more than cost.The inventory was sold in 2016.Building, which was worth $15,000 more than book value, has a remaining life of 8 years, and straight-line depreciation is used.Any remaining excess is goodwill.
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Required:
a.Complete the consolidating worksheet for December 31, 2017.
b.Prepare supportive Income Distribution Schedules for Subsidiary and Parent.

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Definitions:

Completed Suicides

Instances in which attempts to take one's own life result in death.

Suicidal Ideation

Thoughts about killing oneself.

Suicide Rate

The number of suicides occurring among a specific population group during a certain period of time.

European Americans

Individuals in the United States who identify with or are descended from European ancestry.