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On 1/1/2019, Company XXXX purchases 40% of the shares of Company 400,000 cash. On this date, the owners' equity of ZZZZ equals $ 600,000 addition,
On 1/1/2019, Company XXXX purchases 40% of the shares of Company 400,000 cash. On this date, the owners' equity of ZZZZ equals $ 600,000 addition, ZZZZ had the following Overvalued Inventory by $ 20,000 (all sold in 2019) Undervalued building by $ 80,000 (20 years expected useful life) Undervalued land by $ 100,000 Undervalued bonds payable by $ 30,000 (all paid in 2019) Unrecorded patent having a falr value of $50,000 (5 years expected life) In 2019, Company ZZZZ declared and pald dividends of $ 40,000 on 1/6/26 had net Income of $ 100,000. Required: If this purchase is accounted for under the equity method (alwa) your computations): REMEMBER: Overvalued : BV larger than FV Undervalued : BV smaller than FV 1- Compute the FULL goodwill of ZZZZ Company on 1/1/2019. 2- Provide the journal entry in company XXXX's books for the purchase or 1/1/2019 3- Provide the Journal entry in company XXXX's books for the dividends on 1/6/2019 4-Provide the journal entry in company XXXX's books for the income on 31/12/2019. 5- Provide the journal entry in company XXXX's books for the in adjustment on 31/12/2019. 6- Provide the journal entry in company XXXX's books for the bu depreciation adjustment on 31/12/2019. 7- Provide the journal entry If any in company XXXX's books for adjustment on 31/12/2019. 8- Provide the journal entry in company XXXX's books for the bo adjustment on 31/12/2019. 9 - Provide the journal entry in company XXXX's books for the pat adjustment on 31/12/2019
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