Answered step by step
Verified Expert Solution
Question
1 Approved Answer
omework Seved Help Save & Exit Subn Check my work Following are selected accounts for Mergaronite Company and Hill,Inc. as of December 31, 2018. Several
omework Seved Help Save & Exit Subn Check my work Following are selected accounts for Mergaronite Company and Hill,Inc. as of December 31, 2018. Several of Mergaronite's accounts t balances are indicated by parentheses. Dividends were declared and paid in the same period Mergaronite ill $ (584,000) (248,000) Revenues Cost of goods sold Depreciation expense Investment income Retained earnings, 1/1/18 Dividends declared Current asset8 Land Buildings (net) Equipment (net) Liabilities Common stock Additional paid-in capital 298,000 106,000 NA 112,000 58,000 NA (896, 000 (590, 000) 44,000 676,000 84,000 128,000 256, 000 (412,000) (320,000) 134,000 210,000 316,000 510,000 208,000 (288,000) (44,000) 46, 000) (938,000) Assume that Mergaronite took over Hill on January 1, 2014, by issuing 7,200 shares of common stock having a par value of $10 per share but a fair value of $100 each. On January 1, 2014, Hill's land was undervalued by $19,200, its buildings were overvalued by $30,800, and equipment was undervalued by $58,200. The buildings had a 10-year remaning life; the equipment had a 5-year remaining life. A customer list with an appraised value of $104,000 was developed internally by Hill and was to be written off over 20-year period. a. Determine the December 31, 2018, consolidated totals for the following accounts b. In requirement (a), can the consolidated totals be determined without knowing which method the parent used to account for the subsidiary? If the parent uses the equity method, what consolidation entries would be used on a 2018 worksheet?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started