+1(323)689-1506 support@essayhubmarket.com

Looking for help with an assignment? Connect with an assignment Expert Now!

Prepare Pokeman’s consolidated statement of profit or loss for the year

Comprehensive Consolidation Question

On December 31, 2021, Pokeman Limited purchased 60% of the outstanding ordinary shares of Surfer Company for $7,400,000 in cash. On acquisition date, the shareholders’ equity of Surfer consisted of $2,000,000 in ordinary shares and $4,000,000 in retained earnings.

Also on this date, Surfer had inventory with a fair value that was $200,000 less than its carrying value. In addition, Surfer had equipment with a fair value that was $300,000 greater than its carrying value. The equipment had an estimated useful life of 8 years on December 31, 2021. Surfer had an unrecorded Patent worth $120,000 and a useful life of 6 years. Finally, Surfer’s long term liabilities valued at $100,000 less than the carrying (book) value. The LT Liabilities had a ten year term ending in 2031.

 

Each year, consolidated goodwill is tested for impairment. Goodwill had a value of $1,300,000 at December 31, 2025 and $1,000,000 at December 31, 2026.

For the year ended December 31, 2026, the statements of profit or loss for Pokeman and Surfer were as follows:

 

Pokeman

Surfer

 

Sales

$25,000,000

12,500,000

 

Other   Income

5,000,000 

1,000,000 

 

Total revenues

30,000,000 

13,500,000 

 

Cost   of goods sold

18,000,000

8,200,000

 

Depreciation/   amortization expense

3,400,000

1,800,000

 

Other   expenses

4,200,000

1,500,000

 

Income   tax expense

1,100,000 

500,000 

 

Total expenses

26,700,000 

12,000,000 

 

Net income 

3,300,000 

1,500,000 

 

At December 31, 2026, the condensed   statements of financial position for the two companies were as follows:

 

Pokeman

Surfer

 

Current assets

15,000,000

8,600,000

 

Non-current assets

29,600,000

17,400,000

 

Investment in Surfer

7,400,000

__________

 

Total assets 

52,000,000

26,000,000

 

Liabilities

26,400,000

13,600,000

 

Common shares

12,400,000

2,000,000

 

Retained   earnings

13,200,000

10,400,000

 

Total liabilities and equity

52,000,000

26,000,000

 

Additional information: 

1. Intercompany sales of goods are made to earn a margin of 30%

2. In 2025, Surfer sold merchandise to Pokeman for $500,000, of which Pokeman sold 60% to unrelated third parties during 2025.

3. During 2026, Surfer sold merchandise to Pokeman for $400,000, 75% of which remains in Pokeman’s inventory on December 31, 2026.

4. In 2025, Pokeman sold merchandise to Surfer for $600,000; Surfer’s 2025 ending inventory contained 40% of this inventory.

5. During 2026, Pokeman sold merchandise to Surfer for $750,000; Surfer’s 2026 ending inventory contains 30% of this inventory.

6. Surfer owes Pokeman $200,000 as of December 31, 2026 for inventory purchases.

7. Pokeman provides management services for various projects operated by Surfer. For 2026, the amount charged was $20,000 per month for a total of $240,000. Payments for these services are made on the 15th of the following month.

8. During 2026, Pokeman declared and paid dividends of $1,600,000 while Surfer declared and paid dividends of $700,000.

9. On January 1, 2023, Pokeman sold equipment to Surfer for $160,000. Pokeman had acquired the equipment on June 30, 2022 for $240,000 and had estimated a useful life of 6 years. There were no changes made to the remaining useful life when Surfer acquired the equipment.

10. Also in 2023, Surfer sold a piece of land to Pokeman at a profit of $120,000. Half of this land was sold in 2026 to an unrelated third party.

11. On July 1, 2026 Pokeman sold a building to Surfer for $500,000. The building had a net book value of $400,000 (after updating depreciation to the date of sale) on the books of Pokeman, with a remaining useful life of 5 years.

12. Both companies have an income tax at the rate of 0%.

Required: 

a) Prepare Pokeman’s consolidated statement of profit or loss for the year ended and a statement of financial position as at December 31, 2026.

Get a Quick Quote

Approximately 250 words
Total price (USD) $: 10.99

Reviews from Clients who Ordered From Us:

Kate Hogan

They are my go to assignment helper and have been a great help. Thank you!

Sheena easton

I`ve been working with this website for over a year! Here`s what I liked the most about them. First, quality of writing (creative and with catchy titles).

Our Benefits

Get your essay writing needs completed by us and enjoy these and more benefits:

Fast

Whether you have a last minute discussion post due in a couple of hours or the last day in class and you totally forgot to work on that research paper, we always put everything aside to save your grade

Custom Essay

Our qualified team of experts have access to varied online library databases to help with recent and well researched tools that help in writing your paper to deliver a profound research that earns you a stellar grade

80+ Subjects

We do not turn down any type of work. We have qualified writers holding bachelors, graduate and Doctoral certificates matched with skill and expertise. Get help with homework acroos varied subject

Real Time Tracking

We have a user friendly interface to help you track the progress on your order from your client portal. Additionally, with each and every step, you will get notified on the status of your paper to give you an easy time to do other kinds of stuff

Order Our Custom Essay Writing Service

1. Making an Order Tip and Tricks

  • Choose the type of assignment, topic, subject, length, and deadline for your paper.
  • Indicate the following order parameters: service, chosen writer level, number of cited sources, and citation style.
  • Add your document or provide instructions for paper in a specific form.
Image showing step 1 of making an order
Image showing how to make payment for your order

2. Tips and Tricks for Choosing the Right Writer

  • Log in using your email address or your Facebook account.
  • A list of suitable writers will be offered to you. Before making a selection, you can read testimonials or engage in a Live Chat with authors.
  • Check your balance and, if necessary, add funds to your account. Here you will also find exclusive bargains.
  • Put money into the account of the chosen writer.

3. Tips and Tricks for Supervising the Writing Process

  • Get the chance to keep track of the process and connect with your writer.
  • If required, include updated instructions.
  • Have a conversation with your author.
Image showing how to supervise writing process
Image showing how to download your completed results

4. Tips and Tricks to Enjoy the Results

  • You will receive the paper. You have the option of requesting modifications if they are required. Before giving it back to the writer, make a list of the adjustments that need to be made.
  • Accept the paper and send the money to the author.
  • Rate your writer, submit your request, then sit back and enjoy the results.

How can we even make your school life easier with our services?

We always strive to provide the best techniques and skills that help your essay a stellar paper. We have achieved this through the years by offering features such as:

Progressive Delivery

Your order is assigned to a writer who delivere’s your bulk research projects in small chunks and making edits upon feedback from the professor

Native Writers

Our writers are varied across different coutnries such s Canada, Australia, U.K and the United States. Request a native speaker writer to help you ace that paper

Powerpoint slides & other visuals

Order a visual such as Powerpoint to better expound your research paper at $10 per slide including speaker notes

Top rated writers

Order from among the top 10 rated writers at no extra cost