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Posted on Jul 19, 2024

Padre, Inc., buys 80 percent of the outstanding common stock of Sierra Corporation on January 1, 2021, for $826.240 cash. At the acquisition date, Sierra's

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Padre, Inc., buys 80 percent of the outstanding common stock of Sierra Corporation on January 1, 2021, for $826.240 cash. At the acquisition date, Sierra's total fair value, including the noncontrolling Interest, was assessed at $1.032,800 although Sierra's book value was only $645.000. Also, several Individual Items on Sierra's financial records had fair values that differed from their book values as follows: Land Buildings and equipment (18-year remaining life) Copyright (28-year remaining life) Notes payable (due in 8 years) Book Value $ 66,460 360,00 146,880 (196,880) Fair Value $ 327,400 340, eee 280, eee (183,200) For Internal reporting purposes. Padre, Inc., employs the equity method to account for this Investment. The following account balances are for the year ending December 31, 2021. for both companies. Padre $(1,534,948) 756, eee 354.ee Revenues Cost of goods sold Depreciation expense Amortization expense Interest expense Equity in income of Sierra Net income Retained earnings, 1/1/21 Net income Dividends declared Retained earnings, 12/31/21 Current assets Investment in Sierra Land Buildings and equipment (net) Copyright Total assets Accounts payable Notes payable Common stock Additional paid-in capital Retained earnings (above) Total liabilities and equities Sierra $ (675,980) 424,00 18,600 7.380 9.ee @ $ (217,680) $ (485,680) (217,680) 65.680 $ (637,080) $ 648,5ee 53,500 (168,560) $ (540, eee) $(1,377,500) (548,eee) 260,00 $(1,657,500) $ 1,066,70 942,888 316,eee 919, eee @ $ 3, 244,500 $ (282, eee) (555, eee) (388,eee) (45@,eee) (1.657,500) $(3, 244,500) 66,400 341, 4ee 138,780 $ 1,195,000 $ (282,680) (196,880) (188,880) (60,680) (637. eee) $(1,195,680) At year-end, there were no Intre-entity receivables or paysbles. Prepare a worksheet to consolidate the financial statements of these two companies. (For accounts where multiple consolidation entries are required, combine all debit entries into one amount and enter this amount in the debit column of the worksheet. Similarly.combine all credit entries Into one amount and enter this amount in the credit column of the worksheet. Input all amounts es positive values.) Accounts PADRE INC., AND BIERRA CORPORATION Consolidated Worksheet For Year Ending December 31, 2021 Concoildation Entriec Padre Blora Dabit Credit $11.534 940) $ 675,900) 756,000 424,000 354,000 18.600 2,000 0 7.300 6.700 9.000 1.600 (168,560) 0 158.50 $ (540.000 $ 217,000) Noncontrolling Consolidated Interest Totais $ 2.210.840 1,180.000 370.000 14.000 54.100 53,500 5210 485.000 Revenues Cost of goods sold Depreciation expense Amortization expense Interest expense Equity in income of Sierra Separate company net income Consolidated net income Nito noncontrolling interest Ni to Padre Company Retained earnings, 1/1/21 Not income Dividends declared Retained Gamings 12/31/21 Current assets Investment in San Land Buildings and equipment (net) Copyright Total assets Accounts payable Notes able NCIin Sora 1/1 NC in Siarra 12/31 Common stock Additional pain capital Retained earnings (above) Totalebitis and equities 42.140) 42.140 $ 1540,000) $ (1.377,500) 1540,000 13.000 260.000 $ (1.657.500 $ 1.715.200 52,000 52.000 168,560 $11.377,500 $ 485,000) (540.000) 1217,000) 260,000 65.000 $11.667.500 $ 637,000) $ 1,056,700 $ 648.500 342,800 0 316,000 66.400 919,000 341,400 0 138.700 $ 3,244,500 $ 1.195.000 $ (282.000 $ 202,000) (565.000 [195,000) 261,000 2.000 20,000 6,700 134000 643.400 1.242.000 265.000 3.866.600 1484.000 $ $ 12.800 1729.00 1,500 129,000 $ 155.140 (300.000 (450.000) 11.667.500) $13.244 500 1100,000 (50,000) 1637,000) 100.000 50.000 1235.700 300,000 1450,000) (1.657.5001 $ (3,867000) (1.195,000) 5 1.283.680 $ 379,860 Instructions: Answer the following questions in your own hand-writing, take a picture of your document and upload it in this platform. (Contesta las siguientes preguntas a mano (no en computadora), tomale una foto al documento con tus respuestas y subelas en esta plataforma.) Required: (35 points) a) Provide all consolidation journal entries for the previous problem, and all related analysis to determine the amounts for these consolidation entries, as discussed in the Powerpoint presentation for Chapter 4. Example 4. Show all your calculations. b) Provide all related analysis to determine the Non-Controlling Interest amounts, as discussed in the Powerpoint presentation for Chapter 4. Example 4. Show all your calculations. Padre, Inc., buys 80 percent of the outstanding common stock of Sierra Corporation on January 1, 2021, for $826.240 cash. At the acquisition date, Sierra's total fair value, including the noncontrolling Interest, was assessed at $1.032,800 although Sierra's book value was only $645.000. Also, several Individual Items on Sierra's financial records had fair values that differed from their book values as follows: Land Buildings and equipment (18-year remaining life) Copyright (28-year remaining life) Notes payable (due in 8 years) Book Value $ 66,460 360,00 146,880 (196,880) Fair Value $ 327,400 340, eee 280, eee (183,200) For Internal reporting purposes. Padre, Inc., employs the equity method to account for this Investment. The following account balances are for the year ending December 31, 2021. for both companies. Padre $(1,534,948) 756, eee 354.ee Revenues Cost of goods sold Depreciation expense Amortization expense Interest expense Equity in income of Sierra Net income Retained earnings, 1/1/21 Net income Dividends declared Retained earnings, 12/31/21 Current assets Investment in Sierra Land Buildings and equipment (net) Copyright Total assets Accounts payable Notes payable Common stock Additional paid-in capital Retained earnings (above) Total liabilities and equities Sierra $ (675,980) 424,00 18,600 7.380 9.ee @ $ (217,680) $ (485,680) (217,680) 65.680 $ (637,080) $ 648,5ee 53,500 (168,560) $ (540, eee) $(1,377,500) (548,eee) 260,00 $(1,657,500) $ 1,066,70 942,888 316,eee 919, eee @ $ 3, 244,500 $ (282, eee) (555, eee) (388,eee) (45@,eee) (1.657,500) $(3, 244,500) 66,400 341, 4ee 138,780 $ 1,195,000 $ (282,680) (196,880) (188,880) (60,680) (637. eee) $(1,195,680) At year-end, there were no Intre-entity receivables or paysbles. Prepare a worksheet to consolidate the financial statements of these two companies. (For accounts where multiple consolidation entries are required, combine all debit entries into one amount and enter this amount in the debit column of the worksheet. Similarly.combine all credit entries Into one amount and enter this amount in the credit column of the worksheet. Input all amounts es positive values.) Accounts PADRE INC., AND BIERRA CORPORATION Consolidated Worksheet For Year Ending December 31, 2021 Concoildation Entriec Padre Blora Dabit Credit $11.534 940) $ 675,900) 756,000 424,000 354,000 18.600 2,000 0 7.300 6.700 9.000 1.600 (168,560) 0 158.50 $ (540.000 $ 217,000) Noncontrolling Consolidated Interest Totais $ 2.210.840 1,180.000 370.000 14.000 54.100 53,500 5210 485.000 Revenues Cost of goods sold Depreciation expense Amortization expense Interest expense Equity in income of Sierra Separate company net income Consolidated net income Nito noncontrolling interest Ni to Padre Company Retained earnings, 1/1/21 Not income Dividends declared Retained Gamings 12/31/21 Current assets Investment in San Land Buildings and equipment (net) Copyright Total assets Accounts payable Notes able NCIin Sora 1/1 NC in Siarra 12/31 Common stock Additional pain capital Retained earnings (above) Totalebitis and equities 42.140) 42.140 $ 1540,000) $ (1.377,500) 1540,000 13.000 260.000 $ (1.657.500 $ 1.715.200 52,000 52.000 168,560 $11.377,500 $ 485,000) (540.000) 1217,000) 260,000 65.000 $11.667.500 $ 637,000) $ 1,056,700 $ 648.500 342,800 0 316,000 66.400 919,000 341,400 0 138.700 $ 3,244,500 $ 1.195.000 $ (282.000 $ 202,000) (565.000 [195,000) 261,000 2.000 20,000 6,700 134000 643.400 1.242.000 265.000 3.866.600 1484.000 $ $ 12.800 1729.00 1,500 129,000 $ 155.140 (300.000 (450.000) 11.667.500) $13.244 500 1100,000 (50,000) 1637,000) 100.000 50.000 1235.700 300,000 1450,000) (1.657.5001 $ (3,867000) (1.195,000) 5 1.283.680 $ 379,860 Instructions: Answer the following questions in your own hand-writing, take a picture of your document and upload it in this platform. (Contesta las siguientes preguntas a mano (no en computadora), tomale una foto al documento con tus respuestas y subelas en esta plataforma.) Required: (35 points) a) Provide all consolidation journal entries for the previous problem, and all related analysis to determine the amounts for these consolidation entries, as discussed in the Powerpoint presentation for Chapter 4. Example 4. Show all your calculations. b) Provide all related analysis to determine the Non-Controlling Interest amounts, as discussed in the Powerpoint presentation for Chapter 4. Example 4. Show all your calculations