Assignment attached
TAKE HOME QUESTION Listed below is a worksheet containing the financial statements Tiger for the year ending December 31, 2022; for its two 80%-owned subsidiaries, Lion and Panther, on December 31, 2022, and for the year ending December 31, 2022; and the six-month period from June 30 to December 31, 2022, respectively. Tiger acquired Lion on January 1, 2019, for $64,000. At that date, Lion’s stockholders’ equity comprised: Common stock $20,000 Paid-in capital $13,000 Retained earnings $22,000 Lion’s inventory (book value $20,000 – fair value $25,000) and plant (the book value cost $50,000 less accumulated depreciation $10,000 – fair value $55,000) were the only assets that required revaluation at acquisition. The plant had a 10-year remaining useful life from the acquisition date and is still owned. The inventory was sold in 2020. Goodwill, if any, since that date does not require impairment. The value of the noncontrolling interest at the acquisition date was determined to be $15,000. Tiger acquired Panther on June 30, 2022, for $94,000 cash. At the acquisition date, the balance sheet of Panther was as shown in the worksheet listed below. The only asset of Sumother that had a value different from their book value was the inventory, which had a fair value of $40,000. Half of this inventory was sold by December 31, 2022, and the balance is on hand. Goodwill, if appropriate, is also unimpaired since that date. In this acquisition, the noncontrolling interest was valued at $23,000. On January 1, 2021, Tiger had sold the plant to Lion for $120,000. This plant had originally cost Tiger $140,000 and had accumulated depreciation of $40,000 at the date of disposal to Lion. The plant had a five-year remaining useful life from the date of transfer. Lion sells goods to other group members. Inventory sales by Lion to Tiger in 2022 were $40,000. Of these, $16,000 were unsold on December 31, 2022. There were $20,000 of goods held in Tiger’s inventory on January 1, 2022, arising from prior-year purchases from Lion. These were all sold outside the group in the current year. Lion uses a one-third markup on cost for all sales. The unpaid inter-entity balance due to Lion from Tiger included in receivables and payables relating to the inventory sales was $10,000 on December 31, 2022, and $5,000 on December 31, 2021. Tiger has used the cost (original value) method to account for its investments in the attached worksheets. All aspects of taxation may be ignored. QUESTION: 1. On the first worksheet, complete a consolidated balance worksheet for Tiger and its subsidiary on December 31, 2021. 2. Determine, by any means you wish, the figures that would be reported for the Tiger Group in the 2022 consolidated balance sheet, consolidated income statement, and statement of stockholders’ equity. (A properly classified set of financial statements is required with disclosure of the noncontrolling interest. Comparative figures should be included for the balance sheet but are not required for the other statements.) PART 2 Additional Information: There were no fixed-asset sales in the year. Some new fixed assets were acquired for cash. These will have to be determined by considering the change in the fixed-asset accounts. No new long-term debt was issued by any of the companies. Some long-term debt was repaid. There were no material non-cash transactions. 3. Prepare in good form the consolidated statement of cash flows for the Tiger Group for the year ending December 31, 2022. 2021 consol bs worksheet Balance sheets December 31, 2021 TigerLionConsolidated 12/31/2112/31/2112/31/21 Cash70,00030,000 Accounts receivable94,22045,000 Inventory44,88051,950 Investments in subsidiary64,000- 0 Plant and equipment net75,000140,000 348,100266,950 Accounts payable50,00081,800 Accrued liabilities19,0002,150 Long term debt140,00080,000 - 0 - 0 Common stock30,00020,000 Paid in capital24,00013,000 - 0 Retained earnings85,10070,000 - 0 - 0 - 0 348,100266,950 - 0- 0 &C&"Arial,Bold"&A 2022 Consol bs and is worksheet December 31, 2022 YearYearJune - DecCONSOLIDATED TigerLionPantherCONSOLIDATED Income statement Revenues96,000152,800121,000 less Cost of Sales(55,250)(96,400)(65,000) 40,75056,40056,000- 0 less Expenses: Depreciation(5,500)(20,000)(10,000) Other expenses(22,650)(20,400)(15,200) (28,150)(40,400)(25,200)- 0 Operating income12,60016,00030,800- 0 Interest expense(12,000)(4,000)(4,000) Investment income4,000- 0- 0 Net income4,60012,00026,800- 0 Retained earnings statement TigerLionPanther Retained earnings start85,10070,00020,000 Net income4,60012,00026,800 less Dividends paid(10,000)(5,000) Retained earnings 12/3179,70082,00041,800- 0 Balance sheetTigerLionPanther Cash26,90035,0001,000 Accounts receivable30,00040,00045,800 Inventory46,00052,00070,000 Investments158,000- 0- 0 Plant and equipment net80,000128,000160,000 340,900255,000276,800- 0 Accounts payable57,20061,00084,000 Accrued liabilities30,0009,00011,000 Long term debt120,00070,00070,000 Common stock30,00020,00030,000 Paid in capital24,00013,00040,000 Retained earnings79,70082,00041,800 Noncontrolling interest 340,900255,000276,800- 0 - 0- 0- 0- 0 &C&A sumother balance sheet 6.30.22 Panther Balance Sheet 6/30/2022 Cash19,000 Accounts receivable28,000 Inventory30,000 Investments- 0 Plant and equipment160,000 less accumulated depreciation(30,000) 207,000 Accounts payable42,000 Accrued liabilities- 0 Long term debt75,000 Common stock30,000 Paid in capital40,000 Retained earnings20,000 207,000 &C&A