Determination and Distribution of Excess Schedule
Price Paid for Investment		250,000
Less Book Value of Interest Acquired:
Common Stock	100,000
Paid in Capital in Excess of Par	0
Retained Earnings	150,000
Total Value of Equity	250,000
Total Value of Interest Acquired (250,000*80%)	200,000
Excess of Cost over Book Value (Debit) [250,000 - 200,000]		50,000	Amortization
Existing Goodwill		0
Excess Available		50,000
Adjustments:
Depreciable Fixed Assets		50,000	5,000 (50,000/10)
Goodwill		0
Extraordinary Gain		0
Total Adjustments		$50,000
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Part 2)
The eliminations and adjustments are given as follows:
	Account Titles	Debit	Credit
CY1	Subsidiary Income	$15,000
	Investment in Salt Company		$15,000
CY2	Investment in Salt Company (5,000*80%)	$4,000
	Dividends Declared		$4,000
EL	Common Stock - Salt (100,000*80%)	$80,000
	Retained Earnings - Salt (150,000*80%)	$1,20,000
	Investment in Salt Company		$2,00,000
D	Depreciable Fixed Assets	$50,000
	Investment in Salt Company		$50,000
A	Depreciation Expense	$5,000
	Accumulated Depreciation		$5,000
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Part 3)
The consolidated income statement and related income distribution schedule is provided as below:
Pepper Company and Salt Company Consolidated Income Statement
Revenue	250,000
Less Expenses (110,000 + 75,000 + 5,000)	190,000
Consolidated Net Income	60,000
Distributed to Noncontrolling Interest	5,000
Distributed to Controlling Interest	55,000
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Subsidiary Salt Company Income Distribution
		Internally Generated Net Income	25,000
		Adjusted Income	25,000
		NCI Share (25,000*20%)	5,000
____
Parent Pepper Company Income Distribution
Depreciable Fixed Assets	5,000	Internally Generated Net Income	40,000
		Adjusted Income (25,000*80%)	20,000
		Controlling Interest	55,000
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Part 4)
The consolidated balance sheet is prepared as follows:
Paper Company and Salt Company
Consolidated Balance Sheet
31-Dec-01
Assets
Current Assets		190,000
Depreciable Fixed Assets	650,000
Less Accumulated Depreciation	131,000	519,000
Total Assets		$709,000
Liabilities and Stockholder's Equity
Current Liabilities		100,000
Stockholder's Equity:
Noncontrolling Interest		54,000
Controlling Interest:
Common Stock	300,000
Retained Earnings	255,000	555,000
Total Liabilities and Stockholder's Equity		$709,000

1. Do A worksheet for Consolidated Financial Statement

for Pepper and Salt Company