below you will find the trial balance for parent company and its whollyowned purchas 3835195

Below you will find the trial balance for Parent Company and its whollyowned purchase, Subsidiary Company, as of December 31, 2012.The financial statements are denominated in British pounds.Other Important Information:

Company

Parent

Company

Subsidiary

Company

Accounts

Debit

Credit

Debit

Credit

Cash

Â£10,000

Â

Â£4,000

Â

Accounts Receivable

25,000

Â

10,000

Â

Inventory

30,000

Â

12,000

Â

Short-Term Investments

40,000

Â

6,000

Â

Prepaid Assets

35,000

Â

12,000

Â

Investment in Subsidiary

290,000

Â

Â

Â

Long-Term Notes Receivable

150,000

Â

14,000

Â

Debt Service Fund

50,000

Â

Â

Â

Depreciable Assets

900,000

Â

350,000

Â

Accumulated Depreciation

Â

Â£200,000

Â

Â£50,000

Intangible Assets

45,000

Â

20,000

Â

Current Liabilities

Â

92,000

Â

44,000

Long-Term Notes Payable

Â

225,000

Â

119,000

Common Stock

Â

400,000

Â

200,000

Retained Earnings

Â

482,000

Â

50,000

Sales Revenue

Â

750,000

Â

245,000

Cost of Goods Sold

330,000

Â

160,000

Â

Selling Expenses

100,000

Â

45,000

Â

120,000

Â

70,000

Â

Interest Expenses

24,000

Â

5,000

Â

Â
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1. Subsidiary Company’s assets and liabilities are all shown at fair value except for:
a. The fair value of Inventory is 32,000.
b. The fair value of Depreciable Assets is 370,000.
2. Subsidiary company sold Parent Company an item that is in Parent Company’s inventory for 10,000 and cost Subsidiary Company 5,000.The sale was made to Parent Company on credit, and no payment has been made.
3. On December 27, 2012, Parent Company made a long-term loan to Subsidiary Company in the amount of 100,000.
4. Subsidiary Company paid Parent Company 7,000 for Consulting Services.Subsidiary Company considers this an Administrative Expense, and Parent Company considers it Sales Revenue.
5. Exchange rates are:
March 31, 2012, Exchange Rate: 1 Â£ = \$1.24
Average Rate for 2012: 1 Â£ = \$1.22
December 31, 2012, Exchange Rate: 1 Â£ = \$1.20
Attachment:- ACC 690 MILESTONE 1 and 2.xls