Consolidated balance sheet work papers (fair value/book value differentials and noncontrolling interest)
Pop Corporation acquired a 70 percent interest in Stu Corporation on January 1, 2011, for $1,400,000, when Stu’s stockholders’ equity consisted of $1,000,000 capital stock and $600,000 retained earnings. On this date, the book value of Stu’s assets and liabilities was equal to the fair value, except for inventories that were undervalued by $40,000 and sold in 2011, and plant ssets that were undervalued by $160,000 and had a remaining useful life of eight years from January 1. Stu’s net income and dividends for 2011 were $140,000 and $20,000, respectively.
Separate-company balance sheet information for Pop and Stu Corporations at December 31, 2011, follows (in thousands):
Pop
|
Stu
|
Cash
|
$ 120
|
$ 40
|
Accounts receivable—customers
|
880
|
400
|
Accounts receivable from Pop
|
—
|
20
|
Dividends receivable
|
14
|
—
|
Inventories
|
1,000
|
640
|
Land
|
200
|
300
|
Plant assets—net
|
1,400
|
700
|
Investment in Stu
|
1,442
|
—
|
$5,056
|
$2,100
|
Accounts payable—suppliers
|
$ 600
|
$ 160
|
Accounts payable to Stu
|
20
|
—
|
Dividends payable
|
80
|
20
|
Long-term debt
|
1,200
|
200
|
Capital stock
|
2,000
|
1,000
|
Retained earnings
|
1,156
|
720
|
$5,056
|
$2,100
|
REQUIRED: Prepare consolidated balance sheet work papers for Pop Corporation and Subsidiary at December 31, 2011.