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Exercise 3-5 Pool Company purchased 90% of the outstanding common stock of Spruce Company on December 31, 2014, for cash. At that time the balance
Exercise 3-5 Pool Company purchased 90% of the outstanding common stock of Spruce Company on December 31, 2014, for cash. At that time the balance sheet of Spruce Company was as follows: Current assets Plant and equipment Land Total assets $1,083,200 957,550 172,290 $2,213,040 Liabilities Common stock, $20 par value Other contributed capital Retained earnings Total Less treasury stock at cost, 4,955 shares Total equities $748,410 940,000 474,090 149,640 2,312,140 99,100 $2,213,040 Prepare the elimination entry required for the preparation of a consolidated balance sheet workpaper on December 31, 2014, assuming the purchase price of the stock was $1,387,300. Assume that any difference between the book value of net assets and the value implied by the purchase price relates to subsidiary land. (Round answers to 0 decimal places, e.g. 125. If no entry is required, select "No Entry" for the account titles and enter o for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit Common Stock 000 Tother Contributed Capital 474,090|| Retained Earnings 149,640|| Land Investment in Spruce Company 1,387,300 | Noncontrolling Interest 154,144 Treasury Stock 99,100
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