Question
On January 1, 2018, Vicki Co. acquired 70% of Olivia Inc. by paying $650,000.This included a $20,000 control premium.Olivia reported common stock on that date
On January 1, 2018, Vicki Co. acquired 70% of Olivia Inc. by paying $650,000.This included a $20,000 control premium.Olivia reported common stock on that date of $420,000 with retained earnings of $252,000.A building was undervalued in the company's financial records by $28,000.This building had a ten-year remaining life.Copyrights of $80,000 were to be recognized and amortized over 20 years.
Carper earned income and paid cash dividends as follows:
Net income Dividends
2018 $ 105,000 $ 54,600
2019 134,400 61,600
2020 154,000 84,000
On December 31, 2020, there have been no changes in Olivia's common stock account since the acquisition.
a)If the equity method had been applied by Vicki for this acquisition, what were the consolidation entries needed as of December 31, 2020?
b)Compute the change in the NCI during 2020 (label amounts)
a. Prepare the consolidation entries as of Dec. 31, 2020.
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