Question: Metal Corporation acquired 75 percent ownership of
Metal Corporation acquired 75 percent ownership of Ocean Company on January 1, 20X1, at underlying book value. At that date, the fair value of the noncontrolling interest was equal to 25 percent of the book value of Ocean Company. Consolidated balance sheets at January 1, 20X3, and December 31, 20X3, are as follows:
The consolidated income statement for 20X3 contained the following amounts:
Metal and Ocean paid dividends of $30,000 and $20,000, respectively, in 20X3.
Required:
Prepare a worksheet to develop a consolidated statement of cash flows for 20X3 using the indirect method of computing cash flows from operations.
Prepare a consolidated statement of cash flows for 20X3.
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Item Jan. 1, 20X3 Dec. 31, 20X3 $ 68,500 82,000 115,000 45,000 515,000 (186,500) 5,000 $644,000 $ 61,000 26,000 250,000 150,000 130,000 27,000 $644,000 $100,500 97,000 123,000 55,000 550,000 (223,000) 4,000 $706,500 $ 66,000 20,000 265,000 150,000 174,500 31,000 $706,500 Cash Accounts Recelvable Inventory Land Buildings & Equipment Less: Accumulated Depreciation Patents Total Assets Accounts Payable Wages Payable Notes Payable Common Stock ($10 par value) Retained Earnings Noncontrolling Interest Total Liabilities & Owners' Equity Sales $490,000 Cost of Goods Sold Wage Expense Depreciation Expense Interest Expense Amortization Expense Other Expenses $259,000 55,000 36,500 16,000 1,000 39,000 Consolidated Net Income Income to Noncontrolling Interest Income to Controlling Interest (406,500) $ 83,500 (9,000) $ 74,500
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