The following separate account balances are for these two companies forDecember 31, 2015.. Note: Parentheses indicate a credit balance.Sales revenues and interest incomeCost of goods soldExpensesEquity in earnings of AkronNet incomeDoone(868,000)518,000Akron(381,000)212,000185,700(59,540)64,0000(223,840)(105,000)Retained earnings, 1/1/15(494,000)Net income (above)(223,840)(320,000)(105,000)Dividends declared132,00022,000Retained earnings, 12/31/15(585,840)$(403,000)Cash and receivables149,000$137,000Inventory270,000151,000Investment in Akron456,0000Long-term Investment and PPE (net)967,000331,000Total assets$1,842,000619,000LiabilitiesCommon stockRetained earnings, 12/31/15Total liabilities and equity(726,160)$(37,000)(530,000)(179,000)(585,840)(403,000)(1,842,000)$(619,000)5. Compute the amounts that make up the Investment in Akron account balance and thenoncontrolling interest as of December 31, 2015. Show the detailed calculation.6. Prepare an accounting memo describing the errors you identified as well as your proposedcorrections.

The following separate account balances are for these two companies for December 31, 2015.. Note: Parentheses indicate a credit balance. Sales revenues and interest income Cost of goods sold Expenses Equity in earnings of Akron Net income Doone (868,000) 518,000 Akron (381,000) 212,000 185,700 64,000 (59,540) 0 (223,840) (105,000) Retained earnings, 1/1/15 (494,000) (320,000) Net income (above) (223,840) (105,000) Dividends declared 132,000 22,000 Retained earnings, 12/31/15 (585,840) (403,000) Cash and receivables 149,000 Inventory 270,000 137,000 151,000 nvestment in Akron 456,000 0 Long-term Investment and PPE (net) 967,000 331,000 Total assets 1,842,000 619,000 Liabilities Common stock Retained earnings, 12/31/15 Total liabilities and equity (726,160) (530,000) (585,840) (1,842,000) (37,000) (179,000) (403,000) (619,000) Compute the amounts that make up the Investment in Akron account balance and the oncontrolling interest as of December 31, 2015. Show the detailed calculation. Prepare an accounting memo describing the errors you identified as well as your proposed orrections.

The following separate account balances are for these two companies for December 31, 2015.. Note: Parentheses indicate a credit balance. Sales revenues and interest income Cost of goods sold Expenses Equity in earnings of Akron Net income Doone (868,000) 518,000 Akron (381,000) 212,000 185,700 64,000 (59,540) 0 (223,840) (105,000) Retained earnings, 1/1/15 (494,000) (320,000) Net income (above) (223,840) (105,000) Dividends declared 132,000 22,000 Retained earnings, 12/31/15 (585,840) (403,000) Cash and receivables 149,000 Inventory 270,000 137,000 151,000 nvestment in Akron 456,000 0 Long-term Investment and PPE (net) 967,000 331,000 Total assets 1,842,000 619,000 Liabilities Common stock Retained earnings, 12/31/15 Total liabilities and equity (726,160) (530,000) (585,840) (1,842,000) (37,000) (179,000) (403,000) (619,000) Compute the amounts that make up the Investment in Akron account balance and the oncontrolling interest as of December 31, 2015. Show the detailed calculation. Prepare an accounting memo describing the errors you identified as well as your proposed orrections.

Financial Accounting: The Impact on Decision Makers

10th Edition

ISBN:9781305654174

Author:Gary A. Porter, Curtis L. Norton

Publisher:Gary A. Porter, Curtis L. Norton

Chapter5: Inventories And Cost Of Goods Sold

Section: Chapter Questions

Problem 5.8AMCP

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