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Chapman Company obtains 100 percent of Abernethy Company's stock on January 1,2020 . As of that date, Abernethy has the following trial balance: During 2020,
Chapman Company obtains 100 percent of Abernethy Company's stock on January 1,2020 . As of that date, Abernethy has the following trial balance: During 2020, Abernethy reported net income of $122,000 while declaring and paying dividends of $15,000. During 2021, Abernethy reported net income of $175,000 while declaring and paying dividends of $55,000. Assume that Chapman Company acquired Abernethy's common stock for $854,460 in cash. Assume that the equipment and longterm liabilities had fair values of $440,150 and $131,640, respectively, on the acquisition date. Chapman uses the initial value method to account for its investment. Prepare consolidation worksheet entries for December 31, 2020, and December 31, 2021. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Consolidation Worksheet Entries 6 7 8 9 Prepare entry A to recognize allocations in connection with acquisition-date fair values. Note: Enter debits before credits. Prepare entry E to recognize 2020 amortization expense. Note: Enter debits before credits. Prepare entry C to convert parent company figures to equity method. Note: Enter debits before credits
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