Consolidated Worksheet at End of the First Year of Ownership (Equity Method)

Peanut Company acquired 100 percent of Snoopy Companys outstanding common stock for $300,000 on January 1, 20X8, when the book value of Snoopys net assets was equal to $300,000. Peanut uses the equity method to account for investments. Trial balance data for Peanut and Snoopy as of December 31, 20X8, are as follows:

Cash P2. Consolidated Worksheet at End of the First Year of Ownership (Equity Method) Peanut Company acquired 100 percent of Snoopy Company's outstanding common stock for $300,000 on January 1, 20XB, when the book value of Snoopy's net assets was equal to $300,000. Peanut uses the equity method to account for investments, Trial balance data for Peanut and Snoopy as of December 31, 20XB, are as follows: Page 96 Peanut Company Snoopy Company Debit Credit Debit Credit 130,000 $ 80,000 Accounts Receivable 165,000 65,000 Inventory 200,000 75,000 Investment in Snoopy Stock 355,000 Land 200,000 100,000 Buildings & Equipment 700,000 200,000 Cost of Goods Sold 200,000 125.000 Depreciation Expense 50,000 10,000 S&A Expense 225,000 40,000 Dividends Dedared 100,000 20,000 Accumulated Depreciation $ 450,000 $ 20,000 Accounts Payable 75,000 60,000 Bonds Payable 200,000 85,000 Common Stock 500,000 200,000 Retained Earings 225,000 100,000 Sales 800,000 250,000 Income from Snoopy 75.000 Total 52.325,000 $2.325,000 $715 5715.000 Required a. Prepare the journal entries on Peanut's books for the acquisition of Snoopy on January 1, 20X8, as well as any normal equity method entry(ies) related to the investment in Snoopy Company during 20X8. b. Prepare a consolidation worksheet for 20X8 in good form