Haynes, Inc., obtained 100 percent of Turner Company’s common stock on January 1, 2020, by issuing 11,700 shares of $10 par value common stock. Haynes’s shares had a $15 per share fair value. On that date, Turner reported a net book value of $134,050. However, its equipment (with a five-year remaining life) was undervalued by $7,550 in the company’s accounting records. Also, Turner had developed a customer list with an assessed value of $33,900, although no value had been recorded on Turner’s books. The customer list had an estimated remaining useful life of 10 years. The following balances come from the individual accounting records of these two companies as of December 31, 2020: Haynes Turner Revenues $ (730,000 ) $ (240,000 ) Expenses 493,000 125,000 Investment income Not given 0 Dividends declared 120,000 50,000 The following balances come from the individual accounting records of these two companies as of December 31, 2021: Haynes Turner Revenues $ (913,000 ) $ (310,000 ) Expenses 519,300 162,100 Investment income Not given 0 Dividends declared 140,000 30,000 Equipment 572,000 383,000 What balance does Haynes’s Investment in Turner account show on December 31, 2021, when the equity method is applied? What is the consolidated net income for the year ending December 31, 2021? What is the consolidated equipment balance as of December 31, 2021?
Haynes, Inc., obtained 100 percent of Turner Company’s common stock on January 1, 2020, by issuing 11,700 shares of $10 par value common stock. Haynes’s shares had a $15 per share fair value. On that date, Turner reported a net book value of $134,050. However, its equipment (with a five-year remaining life) was undervalued by $7,550 in the company’s accounting records. Also, Turner had developed a customer list with an assessed value of $33,900, although no value had been recorded on Turner’s books. The customer list had an estimated remaining useful life of 10 years.
The following balances come from the individual accounting records of these two companies as of December 31, 2020:
| Haynes | Turner | |||||
| Revenues | $ | (730,000 | ) | $ | (240,000 | ) |
| Expenses | 493,000 | 125,000 | ||||
| Investment income | Not given | 0 | ||||
| Dividends declared | 120,000 | 50,000 | ||||
The following balances come from the individual accounting records of these two companies as of December 31, 2021:
| Haynes | Turner | |||||
| Revenues | $ | (913,000 | ) | $ | (310,000 | ) |
| Expenses | 519,300 | 162,100 | ||||
| Investment income | Not given | 0 | ||||
| Dividends declared | 140,000 | 30,000 | ||||
| Equipment | 572,000 | 383,000 | ||||
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What balance does Haynes’s Investment in Turner account show on December 31, 2021, when the equity method is applied?
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What is the consolidated net income for the year ending December 31, 2021?
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What is the consolidated equipment balance as of December 31, 2021?
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