Question
Below is the trial balance data for Poland and Slovenia on December 31, 2022. In addition, Poland owes Slovenia an Accounts Payable of $25,000 and
Below is the trial balance data for Poland and Slovenia on December 31, 2022. In addition, Poland owes Slovenia an Accounts Payable of $25,000 and Slovenia owes Poland an Accounts Payable of $45,000.
Poland Slovenia
Debits:
Cash $ 290,000 $ 100,000
Accounts Receivable 210,000 190,000
Inventory 400,000 50,000
Land 300,000 100,000
Buildings & Equipment-Net 1,100,000 330,000
Trademarks 0 40,000
Investment in Slovenia 560,000 0
Cost of Goods Sold 550,000 220,000
Depreciation Expense 130,000 45,000
Other Expenses 20,000 35,000
Dividends Declared 100,000 50,000
$3,660,000 $1,160,000
Credits:
Accounts Payable $ 80,000 $ 90,000
Long-Term Liabilities 1,200,000 20,000
Common Stock 1,000,000 400,000
Additional Paid in Capital - 50,000
Retained Earnings, Jan. 1 350,000 150,000
Sales 910,000 450,000
Income from Subsidiary 120,000 0
$3,660,000 $1,160,000
Required:
A. Prepare the journal entries Poland made during 2022 related to its investment in Slovenia.
B. Prepare the consolidation/eliminating entries needed to consolidate the two companies at the end of 2022.
C. Prepare the consolidation working paper for December 31, 2022. Put required CEs/EEs in their proper columns. Use a coding system. Use Figure 3-3 on page 111 as a general guide for the format. MUST use a 6 column format as presented in Figure 3-3. Remember to do the format requirements in the syllabus, such as Dates, Company name (i.e. parent identified), Name of statement, Dollar Signs, Commas, and Underlines.
CHECK FIGURES:
Consolidated Assets = $3,040,000
NCI in Net Income of Slovenia = $30,000
NCI in Net Assets of Slovenia = $140,000
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