The following comparative statements of stockholders’ equity are prepared for Nolan Corporation: Jan.1,2015 Jan.1,2017 Jan.1,2019 Common stock ($10 par). . . . . . . $300,000 $300,000 $300,000 Paid-in capital in excess of par . . . 60,000 60,000 60,000 Retained earnings . . . . . . . . . . . . . . . 42,000 120,000 Total . . . . . . . . . . . . . . . . . . . . . . . . . .$360,000 $402,000 $480,000 Less treasury stock (at cost) . . . . (75,000) (75,000) Total stockholders’ equity. . . . . . $360,000 $327,000 $405,000 Tarman Corporation acquires 60% of Nolan Corporation common stock for $12 per share on January 1, 2015, when the latter corporation is formed. On January 1, 2017, Nolan Corporation purchases 5,000 shares of its own common stock from noncontrolling interests for $15 per share. These shares are accounted for as treasury stock at cost. Assuming Tarman Corporation uses the cost method to record its investment in Nolan Corporation, prepare the necessary cost-to-simple-equity conversion and the eliminations and adjustments required on the consolidated worksheet as of December 31, 2019. Include all pertinent supporting calculations in good form.
The following comparative statements of
Jan.1,2015 Jan.1,2017 Jan.1,2019
Common stock ($10 par). . . . . . . $300,000 $300,000 $300,000
Paid-in capital in excess of par . . . 60,000 60,000 60,000
Total . . . . . . . . . . . . . . . . . . . . . . . . . .$360,000 $402,000 $480,000
Less
Total stockholders’ equity. . . . . . $360,000 $327,000 $405,000
Tarman Corporation acquires 60% of Nolan Corporation common stock for $12 per share on January 1, 2015, when the latter corporation is formed.
On January 1, 2017, Nolan Corporation purchases 5,000 shares of its own common stock from noncontrolling interests for $15 per share. These shares are accounted for as treasury stock at cost.
Assuming Tarman Corporation uses the cost method to record its investment in Nolan Corporation, prepare the necessary
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