Consolidation Eliminating Entries, Date of Acquisition and Two Years Later

Plaza Hotels acquired a 90 percent interest in Stardust Casinos on January 1, 2020 for $51,100,000. The fair value of the 10 percent non-controlling interest at the date of acquisition was $2,900,000. Stardusts date of acquisition reported net assets were carried at amounts approximating fair value, except for these items:

Plant and equipment, 10-year life, straight-line, is overvalued by $6,000,000.

Previously unrecorded limited-life identifiable intangibles, 4-year life, straight-line, were valued at $8,000,000.

Stardusts equity accounts at the date of acquisition were as follows:

Capital stock	$300,000
Retained earnings	1,650,000
Accumulated other comprehensive income	50,000
Total	$2,000,000

Stardust reports net income of $4,000,000 and other comprehensive loss of $10,000 for 2021. Stardust reported net income of $2,800,000 and other comprehensive income of $25,000 in 2020. Stardust did not declare any dividends in either year. Goodwill from this acquisition is impaired by $200,000 during 2021, but was not impaired in 2020.

c. Prepare the consolidation eliminating entries (C), (E), (R), (O) and (N) at December 31, 2021.

Enter your answers in thousands, using decimals if appropriate ($39,400 equals $39.4 in thousands).

Ref.	Description	Debit	Credit
(C)	Answer	Answer	Answer
	Answer	Answer	Answer
	Investment in Stardust	Answer	Answer
(E)	Capital stock	Answer	Answer
	Retained earnings, beg.	Answer	Answer
	Answer	Answer	Answer
	Answer	Answer	Answer
	Noncontrolling interest in Stardust	Answer	Answer
(R)	Identifiable intangibles	Answer	Answer
	Answer	Answer	Answer
	Answer	Answer	Answer
	Investment in Stardust	Answer	Answer
	Noncontrolling interest in Stardust	Answer	Answer
(O)	Operating expenses	Answer	Answer
	Answer	Answer	Answer
	Answer	Answer	Answer
	Goodwill	Answer	Answer
(N)	Answer	Answer	Answer
	Answer	Answer	Answer
	Noncontrolling interest	Answer	Answer