NAME ACC 308 SPRING, 2019 ASSIGNMENT #1: CHAPTERS 1&2 DUE TO BE TURNED IN AT THE BEGINNING OF CLASS ON TUESDAY, 04/16/19 (40 POINTS) Pail Corporation acquired 100 percent of Sand Company stock on January 1, 2018 for $800,00o cash Following are pre-closing trial balance amounts for Pail Corporation and Sand Company as of December 31, 2018 PAIL CORPORATION | SAND CORPORATION Debit Credit Debit $ 215,000 Credit $ 1,413,000 294,000 473,000 874,000 790,000 625,000 481,000 415,000 51,000 48,000 Selling & Administrative Expense209,000 48,000 Cash Accounts Receivable Inventory Investment in Sand Corp. Land Buildings Equipment Cost of Goods Sold Depreciation Expense, Building 174,000 156,000 225,000 360,000 207,000 183,000 34,000 21,000 60,000 Depreciation Expense, Equipment Dividends Declared 65,000 Accumulated Depreciation, Bldg Accumulated Depreciation, Equip Accounts Payable Bonds Payable Common Stock ($1 par) Additional Paid In Capital Retained Earnings (01/01/2018) Sales Income from Sand Corp 170,000 126,000 67,000 100,000 90,000 400,000 310,000 437,000 204,000 144,000 118,000 600,000 2,300,000 789,000 927,000 139,000 $ 5,721,000 5,721,0001,700,000 1,700,000 Additional Information: 1. On January 1, 2018, the book values of Sand's net assets and liabilities approximated fair values 2. Pail Corporation uses the equity method to account for its Investment in Sand Company 3. The general ledger numbers given above (HINT: those in boldface) include the effects of the JOURNAL ENTRIES that were recorded by Pail at the acquisition date and during 2018 to account for its investment in Sand Company. These boldface figures should be used as check figures for your solution. REQUI RED: (CLEARLY SHOW ALL OF YOUR WORK) . a. Prepare the Investment Analysis for Pail Company's Investment in Sand account AT JANUARY 1, 2018 (3 POINTS) Fair Value of Consideration given from Pail Company to Sand's Shareholders: Fair Value of Any Noncontrolling Interest $ Total Fair Value Book Value of Sand Company's Net Identifiable Assets Differential (if any) Identifiable Excess (if any) New Goodwill (if any) b. Recreate the JOURNAL ENTRIES recorded by Pail with regard to its investment in Sand Company at January 1, 2018 and during 2018. (8 POINTS) c. Using your information from b. above, calculate the 12/31/18 balances for Pail Company's Investment in Sand and Income from Sand accounts. Use the T accounts provided below. (4 POINTS) Pail Company's General Ledger Income from Sand Investment in Sand d. Prepare the necessary CONSOLIDATION WORKSHEET ENTRY (or ENTRIES if you choose to prepare the optional accumulated depreciation entry) at December 31, 2018, (9 POINTS) NAME ACC 308 SPRING, 2019 ASSIGNMENT #1: CHAPTERS 1&2 DUE TO BE TURNED IN AT THE BEGINNING OF CLASS ON TUESDAY, 04/16/19 (40 POINTS) Pail Corporation acquired 100 percent of Sand Company stock on January 1, 2018 for $800,00o cash Following are pre-closing trial balance amounts for Pail Corporation and Sand Company as of December 31, 2018 PAIL CORPORATION | SAND CORPORATION Debit Credit Debit $ 215,000 Credit $ 1,413,000 294,000 473,000 874,000 790,000 625,000 481,000 415,000 51,000 48,000 Selling & Administrative Expense209,000 48,000 Cash Accounts Receivable Inventory Investment in Sand Corp. Land Buildings Equipment Cost of Goods Sold Depreciation Expense, Building 174,000 156,000 225,000 360,000 207,000 183,000 34,000 21,000 60,000 Depreciation Expense, Equipment Dividends Declared 65,000 Accumulated Depreciation, Bldg Accumulated Depreciation, Equip Accounts Payable Bonds Payable Common Stock ($1 par) Additional Paid In Capital Retained Earnings (01/01/2018) Sales Income from Sand Corp 170,000 126,000 67,000 100,000 90,000 400,000 310,000 437,000 204,000 144,000 118,000 600,000 2,300,000 789,000 927,000 139,000 $ 5,721,000 5,721,0001,700,000 1,700,000 Additional Information: 1. On January 1, 2018, the book values of Sand's net assets and liabilities approximated fair values 2. Pail Corporation uses the equity method to account for its Investment in Sand Company 3. The general ledger numbers given above (HINT: those in boldface) include the effects of the JOURNAL ENTRIES that were recorded by Pail at the acquisition date and during 2018 to account for its investment in Sand Company. These boldface figures should be used as check figures for your solution. REQUI RED: (CLEARLY SHOW ALL OF YOUR WORK) . a. Prepare the Investment Analysis for Pail Company's Investment in Sand account AT JANUARY 1, 2018 (3 POINTS) Fair Value of Consideration given from Pail Company to Sand's Shareholders: Fair Value of Any Noncontrolling Interest $ Total Fair Value Book Value of Sand Company's Net Identifiable Assets Differential (if any) Identifiable Excess (if any) New Goodwill (if any) b. Recreate the JOURNAL ENTRIES recorded by Pail with regard to its investment in Sand Company at January 1, 2018 and during 2018. (8 POINTS) c. Using your information from b. above, calculate the 12/31/18 balances for Pail Company's Investment in Sand and Income from Sand accounts. Use the T accounts provided below. (4 POINTS) Pail Company's General Ledger Income from Sand Investment in Sand d. Prepare the necessary CONSOLIDATION WORKSHEET ENTRY (or ENTRIES if you choose to prepare the optional accumulated depreciation entry) at December 31, 2018, (9 POINTS)