Company A acquired 100 of Company Bs voting stock on January 1, 2018 by issuing 10,000 shares of its $10 par value common stock Company As common stock had a fair value of $14 per share at that time Company Bs stockholders equity was $105,000 at date of acquisition The trademark was undervalued by $10,000 It has an indefinite life Equipment (with a 5 year life) was undervalued by $5,000 A customer list that had been created internally had an estimated useful life of 20 years was valued at $20,000 Following are the financial statements for the two companies for the year ending December 31, 2018 Company A acquired 100 of Company Bs voting stock on January 1, 2018 by issuing 10,000 shares of its $10 par value common stock Company As common stock had a fair value of $14 per share at that time Company Bs stockholders equity was $105,000 at date of acquisition The trademark was undervalued by $10,000 It has an indefinite life Equipment (with a 5 year life) was undervalued by $5,000 A customer list that had been created internally had an estimated useful life of 20 years was valued at $20,000 Following are the financial statements for the two companies for the year ending December 31, 2018 Step 1 Complete the trial balance of A Company (calculate income of sub and investment in sub) by using the PARTIAL EQUITY Method Step 2 Prepare a Consolidated Worksheet for Year Ended December 31, 2018 Include the consolidated and eliminated journal entries in JOURNAL FORM

Question

Company A acquired 100  of Company Bs voting stock on January 1, 2018 by issuing 10,000 shares of its $10 par value common stock  Company As common stock had a fair value of $14 per share at that time  Company Bs stockholders equity was $105,000 at date of acquisition  The trademark was undervalued by $10,000  It has an indefinite life  Equipment (with a 5 year life) was undervalued by $5,000  A customer list that had been created internally had an estimated useful life of 20 years was valued at $20,000  Following are the financial statements for the two companies for the year ending December 31, 2018  Company A acquired 100  of Company Bs voting stock on January 1, 2018 by issuing 10,000 shares of its $10 par value common stock  Company As common stock had a fair value of $14 per share at that time  Company Bs stockholders equity was $105,000 at date of acquisition  The trademark was undervalued by $10,000  It has an indefinite life  Equipment (with a 5 year life) was undervalued by $5,000  A customer list that had been created internally had an estimated useful life of 20 years was valued at $20,000  Following are the financial statements for the two companies for the year ending December 31, 2018  Step 1  Complete the trial balance of A Company (calculate income of sub and investment in sub) by using the PARTIAL EQUITY Method Step 2  Prepare a Consolidated Worksheet for Year Ended December 31, 2018  Include the consolidated and eliminated journal entries in JOURNAL FORM

Accepted Answer

The Answer is in the image, click to view ...

Question

Company A acquired 100% of Company Bs voting stock on January 1, 2018 by issuing 10,000 shares of its $10 par value common stock. Company

Step by Step Solution

Step: 1

Get Instant Access to Expert-Tailored Solutions

Step: 2

Step: 3

Ace Your Homework with AI

Recommended Textbook for

Horngren S Financial And Managerial Accounting The Managerial Chapters

Students also viewed these Accounting questions

Question

Question

Question

Question

Question

Question

Question

Question

Question

Question

Question

Question

Question