The individual financial statements for Gibson Company and Keller Company for the year ending December 31, 2013, follow. Gibson acquired a 60 percent interest in Keller on January 1, 2012, in exchange for various considerations totaling $510,000. At the acquisition date, the fair value of the noncontrolling interest was $340,000 and Keller’s book value was $670,000. Keller had developed internally a customer list that was not recorded on its books but had an acquisition date fair value of $180,000. This intangible asset is being amortized over 20 years.
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Gibson sold Keller land with a book value of $85,000 on January 2, 2012, for $170,000. Keller still holds this land at the end of the current year. Don't use plagiarized sources. Get Your Custom Essay on
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Keller regularly transfers inventory to Gibson. In 2012, it shipped inventory costing $149,500 to Gibson at a price of $230,000. During 2013, intra entity shipments totaled $280,000, although the original cost to Keller was only $168,000. In each of these years, 20 percent of the merchandise was not resold to outside parties until the period following the transfer. Gibson owes Keller $45,000 at the end of 2013. |
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