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Preparation of Stockholders' Equity Section with Other Comprehensive Income Broadmore Corporation acquired 75 percent of Stem Corporation's common...
Preparation of Stockholders' Equity Section with Other Comprehensive Income
Broadmore Corporation acquired 75 percent of Stem Corporation's common stock on January 1, 20X8, for $435,000.
At that date, Stem reported common stock outstanding of $300,000 and retained earnings of $200,000,
and the fair value of the noncontrolling interest was $145,000.
The book values and fair values of Stem's assets and liabilities were equal,
except for other intangible assets, which had a fair value $80,000 more than book value and a 10-year remaining life.
Broadmore and Stem reported the following data for 20X8 and 20X9:
2018 - Stem Corporation
- net income - 40000
- comprehensive income - 50000
- dividends paid - 15000
2019 - Stem Corporation
- net income - 60000
- comprehensive income - 65000
- dividends paid - 30000
2018 - Broadmore Corporation
- operating income - 120000
- dividends paid - 70000
2019 - Broadmore Corporation
- operating income - 140000
- dividends paid - 70000
- dividends paid - 30000
Required
- Assuming that Broadmore reported capital stock outstanding of $320,000 and retained earnings of $430,000 at January 1, 20X8, prepare the stockholders' equity section of the consolidated balance sheet at December 31, 20X8 and 20X9.
