Pep Corporation acquired 100 percent of See Company stock on January 1, 2019 for $952,000 cash Following are trial balances of Pep Corporation and See Company as of December 31, 2019 CORPORATION Credit $ $ SEE COMPANY Debit Credit 320,500 200.000 175,000 Accounts Receivable Inventory Investment in See Corp. Buildings Land Equipment Cost of Goods Sold Depreciation Expense, Building Depreciation Expense, Equipment Selling & Administrative Expense Dividends Declared Accumulated Depreciation, Bldg Accumulated Depreciation, Equip Accounts Payable Bonds Payable Common Stock ($1 par) Additional Paid In Capital Retained Earnings (01/01/2019) Sales Income from See Corp. PEP Debit 354,000 294,000 472.000 1,151,500 625.000 790,000 481,000 382,000 37,000 48,000 273.000 70,000 360,000 225,000 233,000 110.100 16,800 22,100 117,600 40.000 222,000 192,000 118.000 500.000 600.000 1,416,000 774,000 927,000 239,500 4,988,500 100 BDO 160,500 165 800 120,000 284,000 175,000 291.000 537,000 $ 4,988.500 $ 1834,100 Additional Information: 1. On January 1, 2019 the fair market value of See's assets equaled their book value with the exception of: Inventory-was overvalued by $6,000 (all of this inventory was sold during 2019). Building - was overvalued by $20.000 (remaining useful life was estimated to be 8 years). Land-was by undervalued $81,000 Equipment was undervalued by 574,000 (remaining useful life was estimated to be 5 years). The new Goodwill from the acquisition was impaired by $14,600 at year-end. 2. Pep Corporation uses the (full) equity method to account for its Investment in See Company 3. The general ledger numbers given above (HINT: those in boldface include the effects of the JOURNAL ENTRIES that were recorded by Pep at the acquisition date and during 2019 to account for its investment in See Company. These boldface figures should be used a check figures in your solution Pep Corporation acquired 100 percent of See Company stock on January 1, 2019 for $952,000 cash Following are trial balances of Pep Corporation and See Company as of December 31, 2019 CORPORATION Credit $ $ SEE COMPANY Debit Credit 320,500 200.000 175,000 Accounts Receivable Inventory Investment in See Corp. Buildings Land Equipment Cost of Goods Sold Depreciation Expense, Building Depreciation Expense, Equipment Selling & Administrative Expense Dividends Declared Accumulated Depreciation, Bldg Accumulated Depreciation, Equip Accounts Payable Bonds Payable Common Stock ($1 par) Additional Paid In Capital Retained Earnings (01/01/2019) Sales Income from See Corp. PEP Debit 354,000 294,000 472.000 1,151,500 625.000 790,000 481,000 382,000 37,000 48,000 273.000 70,000 360,000 225,000 233,000 110.100 16,800 22,100 117,600 40.000 222,000 192,000 118.000 500.000 600.000 1,416,000 774,000 927,000 239,500 4,988,500 100 BDO 160,500 165 800 120,000 284,000 175,000 291.000 537,000 $ 4,988.500 $ 1834,100 Additional Information: 1. On January 1, 2019 the fair market value of See's assets equaled their book value with the exception of: Inventory-was overvalued by $6,000 (all of this inventory was sold during 2019). Building - was overvalued by $20.000 (remaining useful life was estimated to be 8 years). Land-was by undervalued $81,000 Equipment was undervalued by 574,000 (remaining useful life was estimated to be 5 years). The new Goodwill from the acquisition was impaired by $14,600 at year-end. 2. Pep Corporation uses the (full) equity method to account for its Investment in See Company 3. The general ledger numbers given above (HINT: those in boldface include the effects of the JOURNAL ENTRIES that were recorded by Pep at the acquisition date and during 2019 to account for its investment in See Company. These boldface figures should be used a check figures in your solution
