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Accounting help!!! n 2008 Froto Company purchased all of the outstanding stock of Mordor Company and accounts for its investment using the cost method Mordor
Accounting help!!!
n 2008 Froto Company purchased all of the outstanding stock of Mordor Company and accounts for its investment using the cost method Mordor has not paid any dividends since 2000. On 1/1/2015 Froto purchased a tractor for $120,000. This tractor is expected to last 8 years and have a $8000 salvage value Froto uses straight line depreciation. On 1/1/2017 Froto sold the tractor to Mordor for $100,000 receiving a 1 year 10% note for the equipment. Mordor believes the tractor will last 6 years and have an $8000 salvage value. Mordor also uses straight line depreciation In 2017; Froto reported unconsolidated income of $125,000 and Mordor reported income of $12,000 In 2018 Froto reported unconsolidated income of $145,000 and Mordor reported income of $14,000 On 1/1/2020 Mordor sold the tractor to Farm's R US for $77,000 n 2020 Froto reported unconsolidated income of $155,000 and Mordor reported income of $22,000 REQUIRED: A) MAKE THE JOURNAL ENTRY FROTO MAKES IN 2015 WHEN IT BUYS THE TRACTOR FOR CASH 8) WHAT IS FROTO'S ANNUAL DEPRECIATION ON THIS TRACTOR C) MAKE THE JOURNAL ENTRY FROTO MAKES WHEN IT SELLS THE TRACTOR TO MORDOR IN 2017 D) MAKE THE JOURNAL ENTRY MORDOR MAKES WHEN IT BUYS THE TRACTOR IN 2017 E) WHAT IS MORDOR'S ANNUAL DEPRECIATION ON THIS TRACTOR? F) WHAT IS CONSOLIDATED INCOME IN 2017? G) MAKE THE NECESSARY WORKSHEET ENTRIES FOR 2017 H) WHAT IS CONOLIDATED INCOME IN 2018 I) MAKE THE NECESSARY WORKSHEET ENTRIES FOR 2018 ) WHAT IS CONSOLIDATED INCOME IN 2020 K) MAKE THE NECESSARY WORKSHEET ENTRIES FOR 2020 Step by Step Solution
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