Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

noncontrolling interest had a fair value of $48,300 and Soda reported $71,000 of common stock outstanding and retained earnings of $31,000. The differential is assigned

image text in transcribed
image text in transcribed
image text in transcribed
noncontrolling interest had a fair value of $48,300 and Soda reported $71,000 of common stock outstanding and retained earnings of $31,000. The differential is assigned to buildings and equipment, which had a fair value $28,000 higher than book value and a remaining 10 -year life, and to patents, which had a fair value $31,000 higher than book value and a remaining life of five years at the date of the business combination. Trial balances for the companies as of December 31,203, are as follows: On December 31,202, Soda purchased inventory for $31,500 and sold it to Pop for $45,000. Pop resold $30,000 of the inventory (ie. $30.000 of the $45.000 acquired from Soda) during 203 and had the remaining balance in inventory at December 31,203. During 20X3, Soda sold inventory purchased for $56,000 to Pop for $80,000, and Pop resold all but $25,000 of its purchase. On March 10,20X3, Pop sold inventory purchased for $15,000 to Soda for $30,000. Soda sold all but $7,800 of the inventory prior to December 31,203. Assume Pop uses the fully adjusted equity method, that both companies use straight tine depreciation, and that no property, plant, and equipment has been purchased since the acquisition. Required: and Soda Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Prepare all consolidation entries needed to prepare a full set of consolidated financial statements at December 31,203, for Pop and Soda. Note: If no entry is required for o transaction/event, select "No journal entry required" in the first account field. Consolidation Worksheet Entries b. Prepare a three-part consolidation worksheet for 203. Note: Values in the first two columns (the "parent" ond "subsidiery" belances) that ore to be deducted should be indicated with a minus sign, whlle oll values In the "Consolldation Entries" columns should be entered as positive values. For occounts where multiple adjusting entries are required, combine all debit entries into one amount and enter this amount in the debit column of the worksheet. Similorly, comblne all credit entrles into one omount and enter this omount in the credit column of the worksheet

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

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

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

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

Get Started

Students also viewed these Accounting questions