Question :
Problem 3 At the of 2013, big and Little had the subsequent income statements and balance sheets:
Big Little
Sales 2,000,000 400,000
Cogs 1,000,000 200,000
Gross profit 1,000,000 200,000
Depreciation exp 400,000 40,000
Investment income a 0
Net income b 160,000
BIG LITTLE
CASH 3,000,000 250,000
INVENTORY 3,000,000 200,000
LAND 4,000,000 1,000,000
EQUIPMENT 3,000,000 300,000
a/d equip 1,400,000 140,000
net equipment 1,600,000 160,000
Investment in Little c 0
TOTAL ASSETS d 1,610,000
ACCOUNTS PAYABLE 2,000,000 200,000
BOND PAYABLE 2,000,000 100,000
TOTAL LIABILITIES 4,000,000 300,000
COMMON STOCK 7,000,000 700,000
RETAINED EARNINGS e 610,000
Required:
a) Fill in the values for a, b, c, d, and e ...you will use any of the 3 methods, full equity, initial value or partial equity but let me know which you are using.
b) Purpose the journal entries that Big made through the year because of its investment in Little, you must use the same technique as you did in part a
c) Purpose the consolidated worksheet entries
d) Purpose the consolidated income statement
e) Purpose the consolidated balance sheet