Acc545 chapter 4 assignment

Pep Corporation acquired 100 percent of See Company stock on January 1, 2019 for $952,000 cash. Following are trial balances of Pep Corporation and See Company as of December 31, 2019: PEP CORPORATION SEE COMPANY Debit Credit Debit Credit Cash $ 364,000 $ 320,500 Accounts Receivable 294,000 204,000 Inventory 473,000 175,000 Investment in See Corp. 1,151,500 Buildings 625,000 360,000 Land 790,000 225,000 Equipment 481,000 233,000 Cost of Goods Sold 382,000 110,100 Depreciation Expense, Building 37,000 16,800 Depreciation Expense, Equipment 48,000 32,100 184000 Selling & Administrative Expense 273,000 117,600 Dividends Declared 70,000 40,000 Accumulated Depreciation, Bidg $ 222,000 $ 100,800 Accumulated Depreciation, Equip 192,000 160,500 Accounts Payable 118,000 165,800 Bonds Payable 500,000 120,000 Common Stock ($1 par) 600,000 284,000 Additional Paid In Capital 1,416,000 175,000 - 750, 0 Retained Earnings (01/01/2019) 774,000 291,000 Sales 927,000 537,000 Income from See Corp. 239,500 $ 4,988,500 $ 4,988,500 $ 1,834,100 $ 1,834,100 Additional Information: 1. On January 1, 2019 the fair market value of See's assets equaled their book value with the exception of: Inventory - was overvalued by $6,000 (all of this inventory was sold during 2019). Building - was overvalued by $20,000 (remaining useful life was estimated to be 8 years). Land - was by undervalued $81,000. Equipment - was undervalued by $74,000 (remaining useful life was estimated to be 5 years). The new Goodwill from the acquisition was impaired by $14,600 at year-end. 2. Pep Corporation uses the (full) equity method to account for its Investment in See Company. 3. The general ledger numbers given above (HINT: those in boldface) include the effects of the JOURNAL ENTRIES that were recorded by Pep at the acquisition date and during 2019 to account for its investment in See Company. These boldface figures should be used a check figures in your solution