2/6

12

answer the first questions

Q:1

Because Primair owns no equity in Vista, all of the acquisition date excess fair over book value is allocated to the noncontrolling interest. Vista paid Primair 25 percent of its 2018 revenues at the end of the year. On December 31, 2018, Primair and Vista submitted the following statements for consolidation. Parentheses indicate credit balances. Primair (847,500) 617,800 78,700 (27,720) Vista (176,900) 70,600 23,500 Revenues Cost of good sold Other operating expenses Interest incone Interest expense Net income Retained earnings, 1/1 Net Income Dividends declared Retained earnings, 12/31 Current assets Loan receivable fron Vista Equipment (net) Trademark Total assets Current liabilities Long-term debt Loan payable to Primair Common stock Retained earnings, 12/31 Total liabilities and equity (178,720) (1,563,000) (178,720) 262, 100 (1,479,620) 461,000 308,000 802,000 27, 720 (55,880) (32,900) (55, 080) @ (87,980) 41,100 1,571,000 (41,380) 431,600 37,000 509,700 (14,800) (83, 920) (308,000) (15,000) (87,980) (509,700) (50,000) (1,479,620) (1,571,080) In computing the amount of Vista's net income attributable to the noncontrolling interest, Vista's net income should be reduced by the 25% revenue allocation to Primair Interest expense paid to Primair is not excluded from Vista's net income because it is a contractual distribution of Vista's net income to Primair. Prepare the December 31, 2018, consolidation worksheet for Primair and Vista (For accounts where multiple consolidation entries are required, combine all debit entries into one amount and enter this amount in the debit column of the worksheet. Similarly, Prepare the December 31, 2018, consolidation worksheet for Primair and Vista. (For accounts where multiple consolidation entries are required, combine all debit entries into one amount and enter this amount in the debit column of the worksheet. Similarly, combine all credit entries into one amount and enter this amount in the credit column of the worksheet. Amounts in the Debit an Credit columns should be entered as positive. Negative amounts for the NCI and Consolidated Totals columns should be entered with a minus sign.) Consolidated Balances NCI $ PRIMAIR AND VISTA Consolidation Worksheet Year Ended December 31, 2018 Consolidation Entries Primair Vista Debit Credit (847,500) $ (176,900) 617,800 70,600 78,700 23,500 (27,720) 27.720 (178,720) $ (55,080) $ 0 Revenues Cost of good sold Other operating expenses Interest income Interest expense Net Income Consolidated net income to noncontrolling interest to Primair Retained earnings, 1/1 Net income Dividends declared Retained earnings, 12/31 Current assets Loan receivable from Vista Equipment (net) Trademark Total assets Current liabilities 0 $ (1,563,000) $ (178,720) 262,100 $ (1.479,620) $ $ 461,000 $ 308,000 802.000 (32,900) (55,080) 0 (87,980) 41,100 0 0 $ 1,571,000 $ (41,380) 431,600 37,000 509,700 (14,800) O Income 27,720 (55,080) $ (178,720) $ 0 $ 0 $ (1,563,000) $ (178,720) 262,100 $ (1,479,620) $ $ 461,000 $ 308,000 802,000 (32,900) (55,080) 0 (87,980) 41,100 $ Interest expense Net Income Consolidated net income to noncontrolling interest to Primair Retained earnings, 1/1 Net income Dividends declared Retained earnings, 12/31 Current assets Loan receivable from Vista Equipment (net) Trademark Total assets Current liabilities Long-term debt Loan payable to Primair Common stock Noncontrolling interest Retained earnings, 12/31 Total liabilities and equity 0 0 $ 1,571,000 $ (41,380) 431,600 37,000 509,700 (14,800) (83,920) (308,000) (15,000) (50,000) (1.479,620) $ (1,571,000) $ (87,980) (509,700) 0 $ 0 Albuquerque, Inc., acquired 18,000 shares of Marmon Company several years ago for $630,000. At the acquisition date, Marmon reported a book value of $600,000, and Albuquerque assessed the fair value of the noncontrolling interest at $70,000. Any excess of acquisition date fair value over book value was assigned to broadcast licenses with indefinite lives. Since the acquisition date and until this point, Marmon has issued no additional shares. No impairment has been recognized for the broadcast licenses. At the present time, Marmon reports $630,000 as total stockholders' equity, which is broken down as follows: Connon stock ($10 par value) Additional paid-in capital Retained earnings Total $ 200,000 260,000 170,000 $ 630,000 View the following as independent situations: a.& b. Marmon sells 10,000 and 4,000 shares of previously unissued common stock to the public for $40 and $30 per share. Albuquerque purchased none of this stock. What journal entry should Albuquerque make to recognize the impact of this stock transaction? (if no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round your intermediate calculations.) View transaction list Journal entry worksheet 1 2 Record the entry to recognize the impact of selling of 10,000 shares. Albuquerque purchased none of this stock. What journal entry should Albuquerque make to recognize the transaction? (if no entry is required for a transaction/event, select "No journal entry required" in the firs round your Intermediate calculations.) View transaction list Journal entry worksheet > In computing the amount of Vista's net income attributable to the noncontrolling interest, Vista's net income should be reduced by the 25% revenue allocation to Primair. Interest expense paid to Primair is not excluded from Vista's net income because it is a contractual distribution of Vista's net income to Primair Prepare the December 31, 2018, consolidation worksheet for Primair and Vista. (For accounts where multiple consolidation entries are required, combine all debit entries into one amount and enter this amount in the debit column of the worksheet. Similarly, combine all credit entries into one amount and enter this amount in the credit column of the worksheet. Amounts in the Debit and Credit columns should be entered as positive. Negative amounts for the NCI and Consolidated Totals columns should be entered with a minus sign.) PRIMAIR AND VISTA Consolidation Worksheet Year Ended December 31, 2018 Consolidation Entries Primair Vista Debit Credit $ (847,500) $ (176,900) 617.800 70,600 78,700 23,500 (27.720) 27,720 $ (178,720) $ (55.080) Consolidated Balances NCI Revenues Cost of good sold Other operating expenses Interest income Interest expense Net Income Consolidated net income to noncontrolling interest to Primair Retained earnings. 1/1 Net income Dividends declared Retained earnings, 12/31 0 $ 0 $ (1,563,000) $ (178,720) 262, 100 $ (1.479,620) $ (32,900) (55,080) 0 (87.980) $ $ (847,500) $ (176,900) 617,800 70,600 78,700 23,500 (27,720) 27,720 $ (178,720) $ (55,080) 0 0 Revenues Cost of good sold Other operating expenses Interest income Interest expense Net Income Consolidated net income to noncontrolling interest to Primair Retained earnings, 1/1 Net Income Dividends declared Retained earnings, 12/31 Current assets Loan receivable from Vista Equipment (net) Trademark Total assets Current liabilities Long-term debt Loan payable to Primair Common stock Noncontrolling interest Retained earnings, 12/31 Total liabilities and equity (32,900) (55,080) 0 (87,980) 41,100 $ $ (1,563,000) $ (178,720) 262,100 $ (1.479,620) $ $ 461,000 $ 308,000 802,000 0 $ 1,571,000 $ (41,380) 0 431,600 37.000 509,700 (14,800) (83,920) (308,000) (15,000) (50,000) (1.479,620) (87,980) $ (1,571,000) S (509,700) 0 0 0 $ 0 Because Primair owns no equity in Vista, all of the acquisition date excess fair over book value is allocated to the noncontrolling interest. Vista paid Primair 25 percent of its 2018 revenues at the end of the year. On December 31, 2018, Primair and Vista submitted the following statements for consolidation. Parentheses indicate credit balances. Primair (847,500) 617,800 78,700 (27,720) Vista (176,900) 70,600 23,500 Revenues Cost of good sold Other operating expenses Interest incone Interest expense Net income Retained earnings, 1/1 Net Income Dividends declared Retained earnings, 12/31 Current assets Loan receivable fron Vista Equipment (net) Trademark Total assets Current liabilities Long-term debt Loan payable to Primair Common stock Retained earnings, 12/31 Total liabilities and equity (178,720) (1,563,000) (178,720) 262, 100 (1,479,620) 461,000 308,000 802,000 27, 720 (55,880) (32,900) (55, 080) @ (87,980) 41,100 1,571,000 (41,380) 431,600 37,000 509,700 (14,800) (83, 920) (308,000) (15,000) (87,980) (509,700) (50,000) (1,479,620) (1,571,080) In computing the amount of Vista's net income attributable to the noncontrolling interest, Vista's net income should be reduced by the 25% revenue allocation to Primair Interest expense paid to Primair is not excluded from Vista's net income because it is a contractual distribution of Vista's net income to Primair. Prepare the December 31, 2018, consolidation worksheet for Primair and Vista (For accounts where multiple consolidation entries are required, combine all debit entries into one amount and enter this amount in the debit column of the worksheet. Similarly, Prepare the December 31, 2018, consolidation worksheet for Primair and Vista. (For accounts where multiple consolidation entries are required, combine all debit entries into one amount and enter this amount in the debit column of the worksheet. Similarly, combine all credit entries into one amount and enter this amount in the credit column of the worksheet. Amounts in the Debit an Credit columns should be entered as positive. Negative amounts for the NCI and Consolidated Totals columns should be entered with a minus sign.) Consolidated Balances NCI $ PRIMAIR AND VISTA Consolidation Worksheet Year Ended December 31, 2018 Consolidation Entries Primair Vista Debit Credit (847,500) $ (176,900) 617,800 70,600 78,700 23,500 (27,720) 27.720 (178,720) $ (55,080) $ 0 Revenues Cost of good sold Other operating expenses Interest income Interest expense Net Income Consolidated net income to noncontrolling interest to Primair Retained earnings, 1/1 Net income Dividends declared Retained earnings, 12/31 Current assets Loan receivable from Vista Equipment (net) Trademark Total assets Current liabilities 0 $ (1,563,000) $ (178,720) 262,100 $ (1.479,620) $ $ 461,000 $ 308,000 802.000 (32,900) (55,080) 0 (87,980) 41,100 0 0 $ 1,571,000 $ (41,380) 431,600 37,000 509,700 (14,800) O Income 27,720 (55,080) $ (178,720) $ 0 $ 0 $ (1,563,000) $ (178,720) 262,100 $ (1,479,620) $ $ 461,000 $ 308,000 802,000 (32,900) (55,080) 0 (87,980) 41,100 $ Interest expense Net Income Consolidated net income to noncontrolling interest to Primair Retained earnings, 1/1 Net income Dividends declared Retained earnings, 12/31 Current assets Loan receivable from Vista Equipment (net) Trademark Total assets Current liabilities Long-term debt Loan payable to Primair Common stock Noncontrolling interest Retained earnings, 12/31 Total liabilities and equity 0 0 $ 1,571,000 $ (41,380) 431,600 37,000 509,700 (14,800) (83,920) (308,000) (15,000) (50,000) (1.479,620) $ (1,571,000) $ (87,980) (509,700) 0 $ 0 Albuquerque, Inc., acquired 18,000 shares of Marmon Company several years ago for $630,000. At the acquisition date, Marmon reported a book value of $600,000, and Albuquerque assessed the fair value of the noncontrolling interest at $70,000. Any excess of acquisition date fair value over book value was assigned to broadcast licenses with indefinite lives. Since the acquisition date and until this point, Marmon has issued no additional shares. No impairment has been recognized for the broadcast licenses. At the present time, Marmon reports $630,000 as total stockholders' equity, which is broken down as follows: Connon stock ($10 par value) Additional paid-in capital Retained earnings Total $ 200,000 260,000 170,000 $ 630,000 View the following as independent situations: a.& b. Marmon sells 10,000 and 4,000 shares of previously unissued common stock to the public for $40 and $30 per share. Albuquerque purchased none of this stock. What journal entry should Albuquerque make to recognize the impact of this stock transaction? (if no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round your intermediate calculations.) View transaction list Journal entry worksheet 1 2 Record the entry to recognize the impact of selling of 10,000 shares. Albuquerque purchased none of this stock. What journal entry should Albuquerque make to recognize the transaction? (if no entry is required for a transaction/event, select "No journal entry required" in the firs round your Intermediate calculations.) View transaction list Journal entry worksheet > In computing the amount of Vista's net income attributable to the noncontrolling interest, Vista's net income should be reduced by the 25% revenue allocation to Primair. Interest expense paid to Primair is not excluded from Vista's net income because it is a contractual distribution of Vista's net income to Primair Prepare the December 31, 2018, consolidation worksheet for Primair and Vista. (For accounts where multiple consolidation entries are required, combine all debit entries into one amount and enter this amount in the debit column of the worksheet. Similarly, combine all credit entries into one amount and enter this amount in the credit column of the worksheet. Amounts in the Debit and Credit columns should be entered as positive. Negative amounts for the NCI and Consolidated Totals columns should be entered with a minus sign.) PRIMAIR AND VISTA Consolidation Worksheet Year Ended December 31, 2018 Consolidation Entries Primair Vista Debit Credit $ (847,500) $ (176,900) 617.800 70,600 78,700 23,500 (27.720) 27,720 $ (178,720) $ (55.080) Consolidated Balances NCI Revenues Cost of good sold Other operating expenses Interest income Interest expense Net Income Consolidated net income to noncontrolling interest to Primair Retained earnings. 1/1 Net income Dividends declared Retained earnings, 12/31 0 $ 0 $ (1,563,000) $ (178,720) 262, 100 $ (1.479,620) $ (32,900) (55,080) 0 (87.980) $ $ (847,500) $ (176,900) 617,800 70,600 78,700 23,500 (27,720) 27,720 $ (178,720) $ (55,080) 0 0 Revenues Cost of good sold Other operating expenses Interest income Interest expense Net Income Consolidated net income to noncontrolling interest to Primair Retained earnings, 1/1 Net Income Dividends declared Retained earnings, 12/31 Current assets Loan receivable from Vista Equipment (net) Trademark Total assets Current liabilities Long-term debt Loan payable to Primair Common stock Noncontrolling interest Retained earnings, 12/31 Total liabilities and equity (32,900) (55,080) 0 (87,980) 41,100 $ $ (1,563,000) $ (178,720) 262,100 $ (1.479,620) $ $ 461,000 $ 308,000 802,000 0 $ 1,571,000 $ (41,380) 0 431,600 37.000 509,700 (14,800) (83,920) (308,000) (15,000) (50,000) (1.479,620) (87,980) $ (1,571,000) S (509,700) 0 0 0 $ 0