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Exercise 4 - 1 9 ( Static ) Wholly Owned Subsidiary with a Differential LO 4 - 3 Stick Corporation is a wholly owned subsidiary
Exercise Static Wholly Owned Subsidiary with a Differential LO
Stick Corporation is a wholly owned subsidiary of Point Corporation. Point acquired ownership of Stick on January for $ above Stick's reported net assets. At that date, Stick reported common stock outstanding of $ and retained earnings of $ The differential is assigned to equipment with an economic life of seven years at the date of the business combination. Stick reported net income of $ and paid dividends of $ in
Required:
a Prepare the journal entries recorded by Point Corporation during on its books if Point accounts for its investment in Stick using the equity method.
b Prepare the consolidating entries needed at December to prepare consolidated financial statements.
Complete this question by entering your answers in the tabs below.
Prepare the consolidating entries needed at December to prepare consolidated financial statements.
Note: If no entry is required for a transactionevent select No journal entry required" in the first account field.
Journal entry worksheet
A B
C
Record the excess value differential reclassification entry.
Note: Enter debits before credits.
tableEventAccounts,Debit,Credit
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