(1) RECORD THE BASIC CONSOLIDATION ENTRY

(2) RECORD THE ENTRY FOR OTHER COMPREHENSIVE INCOME

(3) RECORD THE OPTIONAL ACCUMULATED DEPRECIATION CONSOLIDATION ENTRY

Pirate Corporation acquired 60 percent ownership of Ship Company on January 1, 20X8, at underlying book value. At that date, the fair value of the noncontrolling Interest was equal to 40 percent of the book value of Ship Company. Accumulated depreciation on Buildings and Equipment was $71,000 on the acquisition date. Trial balance data at December 31, 20X8, for Pirate and Ship are as follows: Pirate Corporation Ship Company Item Debit Credit Debit Credit Cash $ 46,000 $ 17,000 Accounts Receivable 81,000 41,000 Inventory 59,000 49,000 Buildings & Equipment 503,000 241,000 Investment in Row Company 46,000 Investment in Ship Company 100,080 Cost of Goods Sold 143,000 103,000 Depreciation Expense 30,000 10,000 Interest Expense 7,000 3,000 Dividends Declared 29,000 22,200 Accumulated Depreciation $138,000 $ 81,000 Accounts Payable 57,000 19,000 Bonds Payable 152,880 127,200 Common Stock 194,000 91,000 Retained Earnings 202,000 51,000 Other Comprehensive Income from Ship Company (OCI)-Unrealized Gain on Investments 6,000 Unrealized Gain on Investments (OCI) 10,000 Sales 226,000 153,000 Income from Ship Company 22,200 $998,080 $998,080 $532,200 $532,200 Additional Information Ship purchased stock of Row Company on January 1, 20X8, for $36,000 and classified the investment as available-for-sale securities. The value of Row's securities increased to $46,000 at December 31, 20X8. Required: a. Record all consolidation entries needed to prepare a three-part consolidation worksheet as of December 31, 20X8. (If no entry is required for a transaction/event, select "No journal entry required" In the first account field.) b. Prepare a three-part consolidation worksheet for 20X8 in good form. (Values in the first two columns (the "parent" and "subsidiary" balances) that are to be deducted should be indicated with a minus sign, while all values in the "Consolidation Entries" columns should be entered as positive values. For accounts where multiple adjusting entries are required, combine all deblt entries into one amount and enter this amount in the deblt column of the worksheet. Similarly, combine all credit entries into one amount and enter this amount in the credit column of the worksheet.) PIRATE CORPORATION AND SUBSIDIARY Worksheet for Consolidated Financial Statements December 31, 20X8 Consolidation Entries Pirate Co. Ship Co. DR CR Consolidated $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 Income Statement Sales Less: COGS Less: Depreciation expense Less: Interest expense Income from Ship Company Consolidated net income NCI in net income Controlling Interest in Net Income Statement of Retained Earnings Beginning balance Net income Less: Dividends declared Ending Balance Balance Sheet Cash Accounts receivable Inventory Buildings and equipment Less: Accumulated depreciation Investment in Row Company Investment in Ship Company Total Assets Accounts payable Bonds payable Common stock $ 0 $ 0 $ 0 0 $ 0 $ 0 $ 0 $ 0$ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 Retained earnings Accumulated OCI NCI in NA of Ship Company Total Liabilities and Equity Other Comprehensive Income Accumulated other comprehensive income, 1/1/20x8 Other comprehensive income from Ship Company Unrealized gain on investments Other comprehensive income to NCI Accumulated Other Comprehensive Income, 12/31/20X8 0 0 $ 0 $ 0 $ 0 C. Prepare a consolidated balance sheet, income statement, and statement of comprehensive Income for 20X8. (Amounts to be deducted should be indicated with a minus sign.) PIRATE CORPORATION AND SUBSIDIARY Consolidated Balance Sheet December 31, 20x8 Assets 0 Total Assets $ 0 Liabilities Stockholders' Equity: Controlling Interest: Total Controlling Interest 0 0 Total Stockholder's Equity Total Liabilities and Stockholders' Equity $ 0 PIRATE CORPORATION AND SUBSIDIARY Consolidated Income Statement Year Ended December 31, 20X8 Total expenses 0 Consolidated net income 0 Income to controlling interest $ 0 PIRATE CORPORATION AND SUBSIDIARY Consolidated Statement of Comprehensive Income Year Ended December 31, 20X8 Consolidated net income Other comprehensive income: Unrealized gain on investments held by subsidiary Total consolidated comprehensive income Less: Comprehensive income attributable to noncontrolling interest Comprehensive income attributable to controlling interest $ 0 Pirate Corporation acquired 60 percent ownership of Ship Company on January 1, 20X8, at underlying book value. At that date, the fair value of the noncontrolling Interest was equal to 40 percent of the book value of Ship Company. Accumulated depreciation on Buildings and Equipment was $71,000 on the acquisition date. Trial balance data at December 31, 20X8, for Pirate and Ship are as follows: Pirate Corporation Ship Company Item Debit Credit Debit Credit Cash $ 46,000 $ 17,000 Accounts Receivable 81,000 41,000 Inventory 59,000 49,000 Buildings & Equipment 503,000 241,000 Investment in Row Company 46,000 Investment in Ship Company 100,080 Cost of Goods Sold 143,000 103,000 Depreciation Expense 30,000 10,000 Interest Expense 7,000 3,000 Dividends Declared 29,000 22,200 Accumulated Depreciation $138,000 $ 81,000 Accounts Payable 57,000 19,000 Bonds Payable 152,880 127,200 Common Stock 194,000 91,000 Retained Earnings 202,000 51,000 Other Comprehensive Income from Ship Company (OCI)-Unrealized Gain on Investments 6,000 Unrealized Gain on Investments (OCI) 10,000 Sales 226,000 153,000 Income from Ship Company 22,200 $998,080 $998,080 $532,200 $532,200 Additional Information Ship purchased stock of Row Company on January 1, 20X8, for $36,000 and classified the investment as available-for-sale securities. The value of Row's securities increased to $46,000 at December 31, 20X8. Required: a. Record all consolidation entries needed to prepare a three-part consolidation worksheet as of December 31, 20X8. (If no entry is required for a transaction/event, select "No journal entry required" In the first account field.) b. Prepare a three-part consolidation worksheet for 20X8 in good form. (Values in the first two columns (the "parent" and "subsidiary" balances) that are to be deducted should be indicated with a minus sign, while all values in the "Consolidation Entries" columns should be entered as positive values. For accounts where multiple adjusting entries are required, combine all deblt entries into one amount and enter this amount in the deblt column of the worksheet. Similarly, combine all credit entries into one amount and enter this amount in the credit column of the worksheet.) PIRATE CORPORATION AND SUBSIDIARY Worksheet for Consolidated Financial Statements December 31, 20X8 Consolidation Entries Pirate Co. Ship Co. DR CR Consolidated $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 Income Statement Sales Less: COGS Less: Depreciation expense Less: Interest expense Income from Ship Company Consolidated net income NCI in net income Controlling Interest in Net Income Statement of Retained Earnings Beginning balance Net income Less: Dividends declared Ending Balance Balance Sheet Cash Accounts receivable Inventory Buildings and equipment Less: Accumulated depreciation Investment in Row Company Investment in Ship Company Total Assets Accounts payable Bonds payable Common stock $ 0 $ 0 $ 0 0 $ 0 $ 0 $ 0 $ 0$ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 Retained earnings Accumulated OCI NCI in NA of Ship Company Total Liabilities and Equity Other Comprehensive Income Accumulated other comprehensive income, 1/1/20x8 Other comprehensive income from Ship Company Unrealized gain on investments Other comprehensive income to NCI Accumulated Other Comprehensive Income, 12/31/20X8 0 0 $ 0 $ 0 $ 0 C. Prepare a consolidated balance sheet, income statement, and statement of comprehensive Income for 20X8. (Amounts to be deducted should be indicated with a minus sign.) PIRATE CORPORATION AND SUBSIDIARY Consolidated Balance Sheet December 31, 20x8 Assets 0 Total Assets $ 0 Liabilities Stockholders' Equity: Controlling Interest: Total Controlling Interest 0 0 Total Stockholder's Equity Total Liabilities and Stockholders' Equity $ 0 PIRATE CORPORATION AND SUBSIDIARY Consolidated Income Statement Year Ended December 31, 20X8 Total expenses 0 Consolidated net income 0 Income to controlling interest $ 0 PIRATE CORPORATION AND SUBSIDIARY Consolidated Statement of Comprehensive Income Year Ended December 31, 20X8 Consolidated net income Other comprehensive income: Unrealized gain on investments held by subsidiary Total consolidated comprehensive income Less: Comprehensive income attributable to noncontrolling interest Comprehensive income attributable to controlling interest $ 0