Question
On January 1, 2000 Apple Company acquired all of the stock of Pear Company at book value. Apple accounts for its investment in Pear using
On January 1, 2000 Apple Company acquired all of the stock of Pear Company at book value. Apple accounts for its investment in Pear using the initial value method and Pear doesn't pay any dividends
On January 1st 2015 Pear Company issued $1,000,000 face value bonds for $930,000 These 7% bonds pay interest each July 1 and January 1. Pear uses straight line amortization on these 20 year bonds.
On January 1, 2020, Apple Company acquired all of the Pear bonds for $955,000.
Please answer:
e. make necessary worksheet entries for 2020
f. In 2020, Apple reported unconsolidated income of $900,000 and Pear reported income of $100,000. What is consolidated income?
g. Make necessary worksheet entries for 2021
h. In 2021, Apple reported unconsolidated income of $800,000 and Pear reported income of $125,000. What is consolidated income?
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Financial Accounting Tools for Business Decision Making
Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso, Barbara Trenholm, Wayne Irvine
5th Canadian edition
978-1118024492
