Question
On January 1, 20X7, Pell acquired 90% of Sell for $200,000 plus $15,000 in acquisition costs. On the date of acquisition, Sell had the following
On January 1, 20X7, Pell acquired 90% of Sell for $200,000 plus $15,000 in acquisition costs. On the date of acquisition, Sell had the following balance sheet:
An appraisal indicates that the following items have fair values that differed from their book values:
Immediately after the purchase, Pell had the following balance sheet:
INSTRUCTIONS: (1) Record the investment in Sell. (2) Prepare a value analysis schedule. (3) Prepare a determination and distribution of excess schedule. (4) Prepare all required elimination entries for the January 1, 20X7 consolidated worksheet in general journal format. (5) Complete a consolidated worksheet for Pell and its subsidiary Sell as of January 1, 20X7. (6) Prepare a consolidated balance sheet in good form as of January 1, 20X7.
Sell Company Balance Sheet January 1, 20x7 Assets Liabilities and Equity Accounts Receivable Inventory Land Buildings Accunulated Depreciation Equipment Accumulated Depreciation Goodwill Total Assets $40,000 Cument Liabilities 160,000 Bonds Payable 60,000 Common Stock, $1 par 150,000 Paid-in Capital (20,000) Retained Earnings $60,000 100,000 150,000 50,000 100,000 50,000 (10.000) 30,000 $460.000 Total Liabilities and Equity $460.000Step by Step Solution
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