Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

For those interested let's change up the problem a little and look at the initial value method. Accounts Payable $50, Accounts Receivable $40, Additional Paid

For those interested let's change up the problem a little and look at the initial value method.

Accounts Payable $50, Accounts Receivable $40, Additional Paid in Capital $50, Building (4 year remaining life, net) $120, Cash $60, Common Stock $250, Equipment (5 year remaining life, net) $200, Inventory $90, Land $80, Long-term liabilities (mature end of Year 4) $150, Retained earnings (Beg Year 1) $100, and Supplies $10

During year 1, Company B reported net income of $80 and paid dividends of $10. During Year 2, reported net income of $110, and paid dividends of $30.

Company A again acquired all common stock of Company B for $500 cash. Fair value of Equipment $220, long-term Liabilities $120 at the date of acquisition. Company A uses the initial value method, what are the consolidation worksheet entries for the end of the first year, and the end of the second year?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Front Office Operations And Auditing Workbook

Authors: Patrick J. Moreo, Gail Sammons, Jeff Beck

2nd Edition

0130324930, 978-0130324931

More Books

Students also viewed these Accounting questions

Question

What are your options besides a rote memory approach?

Answered: 1 week ago