Consolidating a VIE in a Subsequent Year Pelican Mountain Resorts uses a financial entity to obtain...

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Consolidating a VIE in a Subsequent Year Pelican Mountain Resorts uses a financial entity to obtain secured debt. It sells customer timeshare agreements to the entity, who finances the purchases with debt secured by future collections on the timeshare agreements. On January 1, 2019, Pelican determines that the entity is a VIE and Pelican is its primary beneficiary. Pelican has no equity interest in the VIE. The VIE's balance sheet on that date is as follows: Receivables $4,000,000 Secured debt $4,250,000 Other assets 500,000 Equity 250,000 Total assets $4,500,000 Total debt & equity $4,500,000 On January 1, 2019, the VIE's other assets are undervalued by $65,000 and it has previously unrecorded identifiable intangible assets of $1,000,000. The fair value of the VIE is $1,500,000. It is now December 31, 2019, the end of the accounting year. The revalued other assets consist of equipment having a 5-year life, straight-line. The identifiable intangibles are impaired by $100,000. The goodwill is not impaired. The VIE reports net income of $125,000 for 2019. Required Prepare the eliminating entries required to consolidate the VIE with Pelican on December 31, 2019, assuming the VIE and Pelican are not under common control prior to Pelican's identification as the primary beneficiary. Prepare the eliminating entries required to consolidate the VIE with Pelican on December 31, 2019, assuming the VIE and Pelican are not under common control prior to Pelican's identification as the primary beneficiary. Consolidating a VIE in a Subsequent Year Pelican Mountain Resorts uses a financial entity to obtain secured debt. It sells customer timeshare agreements to the entity, who finances the purchases with debt secured by future collections on the timeshare agreements. On January 1, 2019, Pelican determines that the entity is a VIE and Pelican is its primary beneficiary. Pelican has no equity interest in the VIE. The VIE's balance sheet on that date is as follows: Receivables $4,000,000 Secured debt $4,250,000 Other assets 500,000 Equity 250,000 Total assets $4,500,000 Total debt & equity $4,500,000 On January 1, 2019, the VIE's other assets are undervalued by $65,000 and it has previously unrecorded identifiable intangible assets of $1,000,000. The fair value of the VIE is $1,500,000. It is now December 31, 2019, the end of the accounting year. The revalued other assets consist of equipment having a 5-year life, straight-line. The identifiable intangibles are impaired by $100,000. The goodwill is not impaired. The VIE reports net income of $125,000 for 2019. Required Prepare the eliminating entries required to consolidate the VIE with Pelican on December 31, 2019, assuming the VIE and Pelican are not under common control prior to Pelican's identification as the primary beneficiary. Prepare the eliminating entries required to consolidate the VIE with Pelican on December 31, 2019, assuming the VIE and Pelican are not under common control prior to Pelican's identification as the primary beneficiary.