Exercise 4-7

On January 1, 2014, Pert Company purchased 85% of the outstanding common stock of Sales Company for $353,500. On that date, Sales Companys stockholders equity consisted of common stock, $105,400; other contributed capital, $41,200; and retained earnings, $126,000. Pert Company paid more than the book value of net assets acquired because the recorded cost of Sales Companys land was significantly less than its fair value. During 2014 Sales Company earned $139,400 and declared and paid a $51,500 dividend. Pert Company used the partial equity method to record its investment in Sales Company. Assume that during 2015 Sales Company earned $173,500 and declared and paid a $51,500 dividend.

**** JUST NEED ANSWERS TO B***

**** A IS GIVEN****

Exercise 4-7 On January 1, 2014, Pert Company purchased 85% of the outstanding common stock of Sales $126,000. Pert Company paid more than the book value of net assets acquired because the re During 2014 Sales Company earned $139,400 and declared and paid a $51,500 dividend. Pert Assume that during 2015 Sales Company earned $173,500 and declared and paid a $51,500 d (a) Your answer is correct. Prepare the investment-related entries on Pert Company's books for 2015. (Credit account ti the amounts.) Account Titles and Explanation Debit Credit Investment in Subsidiary 147,475 Equity in Subsidiary Inc (To record equity income (loss)) 147,475 Cash 43,775 Investment in Subsidiai (To record dividend income) 43,775 SHOW LIST OF ACCOUNTS LINK TO TEXT (b) Your answer is partially correct. Try again. Prepare the workpaper eliminating entries for a workpaper on December 31, 2015. (Credit acco o for the amounts. Round answers to 0 decimal places, e.g. 5,125.) ieRY CES (b) Your answer is partially correct. Try again. Prepare the workpaper eliminating entries for a workpaper on December 31, 2015. (Credit account title O for the amounts. Round answers to 0 decimal places, e.g. 5,125.) Account Titles and Explanation Debit Credit Investment in Subsidiary 147,475 Dividends Declared - SI tudy. 43,775 Investment in Subsidiai 191,250 (To record equity income (loss) and dividend income) Common Stock - Subsidiar 105,400 Other Contributed Capital 41,200 [Retained Earnings - Subsic Difference between Implie Investment in Subsidiary Noncontrolling Interest (To eliminate investment in subsidiary and create noncontrolling interest) Difference between Implie (To eliminate excess of the book value of equity acquired.) SHOW LIST OF ACCOUNTS LINK TO TEXT pe here to search O BE Exercise 4-7 On January 1, 2014, Pert Company purchased 85% of the outstanding common stock of Sales $126,000. Pert Company paid more than the book value of net assets acquired because the re During 2014 Sales Company earned $139,400 and declared and paid a $51,500 dividend. Pert Assume that during 2015 Sales Company earned $173,500 and declared and paid a $51,500 d (a) Your answer is correct. Prepare the investment-related entries on Pert Company's books for 2015. (Credit account ti the amounts.) Account Titles and Explanation Debit Credit Investment in Subsidiary 147,475 Equity in Subsidiary Inc (To record equity income (loss)) 147,475 Cash 43,775 Investment in Subsidiai (To record dividend income) 43,775 SHOW LIST OF ACCOUNTS LINK TO TEXT (b) Your answer is partially correct. Try again. Prepare the workpaper eliminating entries for a workpaper on December 31, 2015. (Credit acco o for the amounts. Round answers to 0 decimal places, e.g. 5,125.) ieRY CES (b) Your answer is partially correct. Try again. Prepare the workpaper eliminating entries for a workpaper on December 31, 2015. (Credit account title O for the amounts. Round answers to 0 decimal places, e.g. 5,125.) Account Titles and Explanation Debit Credit Investment in Subsidiary 147,475 Dividends Declared - SI tudy. 43,775 Investment in Subsidiai 191,250 (To record equity income (loss) and dividend income) Common Stock - Subsidiar 105,400 Other Contributed Capital 41,200 [Retained Earnings - Subsic Difference between Implie Investment in Subsidiary Noncontrolling Interest (To eliminate investment in subsidiary and create noncontrolling interest) Difference between Implie (To eliminate excess of the book value of equity acquired.) SHOW LIST OF ACCOUNTS LINK TO TEXT pe here to search O BE