What amount of "total assets" will appear in the consolidated balance sheet at December 31, 2016?
$4,382,400
$3,830,400
$4,062,400
$4,190,400 <-- this is the correct answer
Please show work on how to get this answer.
Assume that an investor acquired 100% of the voting common stock of an investee on January 1, 2009, in a transaction that qualifies as a business combination. As a result of the acquisition, the investor recognized no goodwill and no bargain purchase gain in the post-acquisition consolidated financial statements (i.e., all of the resulting Acquisition Accounting Premium relates to identifiable net assets). The investor uses the equity method to account for its pre-consolidation investment in the investee. In addition, there are no intercompany transactions between the investor and investee. The following summarized pre-consolidation financial statement information is for the year ending December 31, 2016:
Income Statement:
Revenues:
Investor: $1,920,000
Investee: $256,000
Income from Investee: $120,000
Total Revenues: $2,296,000
Expenses:
Investor: $760,000
Investee: $128,000
Total Expenses: $888,000
Consolidated net income: $1,408,000
NCI (Net income): $128,000
Statement of Retained Earnings:
Retained earnings, January 1: $601,600
Net income: $760,000
Dividends declared: ($51,200)
Retained earnings, December 31: $1,310,400
Balance Sheet:
Investment in Investee: $232,000
Cash: $3,830,400
Other assets: $320,000
Total assets: $4,382,400
Liabilities: $2,112,000
Common stock and additional paid-in capital: $640,000
Retained earnings: $1,310,400
Total liabilities and equity: $4,062,400
