Pitcher Corporation purchased 60 percent of Softball Corporations voting common stock on January 1, 20X1. On December

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Pitcher Corporation purchased 60 percent of Softball Corporation’s voting common stock on January 1, 20X1. On December 31, 20X5, Pitcher received $210,000 from Softball for a truck Pitcher had purchased on January 1, 20X2, for $300,000. The truck is expected to have a 10-year useful life and no salvage value. Both companies depreciate trucks on a straight-line basis.


Required

a. Give the worksheet consolidation entry or entries needed at December 31, 20X5, to remove the effects of the intercompany sale.

b. Give the worksheet consolidation entry or entries needed at December 31, 20X6, to remove the effects of the intercompany sale.

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Advanced Financial Accounting

ISBN: 9781260772135

13th Edition

Authors: Theodore Christensen, David Cottrell, Cassy Budd

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