Phone Corporation acquired 70 percent of Smart Corporation's common stock on December 31, 20X4, for $92,400. At that date, the fair value of the noncontrolling interest was $39,600. Data from the balance sheets of the two companies included the following amounts as of the date of acquisition Phone Smart Item Cash Accounts Receivable Inventory Corporation Corporation $ 53,300 94,000 140,000 73,000 427,000 $ 40,000 48,000 82,000 38,000 269,000 an Buildings & Equipment Less: Accumulated Depreciation Investment in Smart Corporation Total Assets (162,000) (75,000) 92,400 $ 717,700 $402,000 Accounts Payable Mortgage Payable Common Stock Retained Earnings Total Liabilities&Stockholders' Equity $ 143,500 318,200 66,000 190,000 $ 717,700 33,000 258,000 31,000 80,000 $402,000 At the date of the business combination, the book values of Smart's assets and liabilities approximated fair value except for inventory which had a fair value of $88,000, and buildings and equipment, which had a fair value of $209,000. At December 31, 20X4, Phone reported accounts payable of $13,200 to Smart, which reported an equal amount in its accounts receivable Required a. Prepare the consolidation entry or entries needed to prepare a consolidated balance sheet immediately following the business combination. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Consolidation Worksheet Entries Record the basic consolidation entry Note: Enter debits before credits. Entry Accounts Debit Credit Consolidation Worksheet Entries Record the excess value (differential) reclassification entry. Note: Enter debits before credits. Entry Accounts Debit Credit 2 Consolidation Worksheet Entries Record the entry to eliminate the intercompany accounts. Note: Enter debits before credits Entry Accounts Debit Credit Consolidation Worksheet Entries Record the optional accumulated depreciation consolidation entry. Note: Enter debits before credits. Entry Accounts Debit Credit 4 entered as positive values. For accounts where multiple adjusting 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.) PHONE CORPORATION AND SUBSIDIARY Consolidated Balance Sheet December 31, 20X4 Consolidation Entries Phone Corp. Smart Corp DR CR Consolidated Assets Cash Accounts receivable Inventory Land Buildings and equipment Less: Accumulated depreciation Investment in Smart Corporation Total Assets Liabilities and Equity Accounts payable Mortgage payable Common stock Retained earnings NCl in NA of Smart Corporation Total Liabilities and Eauitv 0 $ 0 0l $ 0l $ Consolidated Balance Sheet December 31, 20X4 Assets Total Assets Liabilities Stockholders' Equity Controlling Interest Total Controlling Interest Total Stockholders' equity Total Liabilities and Stockholders' Eauitv Phone Corporation acquired 70 percent of Smart Corporation's common stock on December 31, 20X4, for $92,400. At that date, the fair value of the noncontrolling interest was $39,600. Data from the balance sheets of the two companies included the following amounts as of the date of acquisition Phone Smart Item Cash Accounts Receivable Inventory Corporation Corporation $ 53,300 94,000 140,000 73,000 427,000 $ 40,000 48,000 82,000 38,000 269,000 an Buildings & Equipment Less: Accumulated Depreciation Investment in Smart Corporation Total Assets (162,000) (75,000) 92,400 $ 717,700 $402,000 Accounts Payable Mortgage Payable Common Stock Retained Earnings Total Liabilities&Stockholders' Equity $ 143,500 318,200 66,000 190,000 $ 717,700 33,000 258,000 31,000 80,000 $402,000 At the date of the business combination, the book values of Smart's assets and liabilities approximated fair value except for inventory which had a fair value of $88,000, and buildings and equipment, which had a fair value of $209,000. At December 31, 20X4, Phone reported accounts payable of $13,200 to Smart, which reported an equal amount in its accounts receivable Required a. Prepare the consolidation entry or entries needed to prepare a consolidated balance sheet immediately following the business combination. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Consolidation Worksheet Entries Record the basic consolidation entry Note: Enter debits before credits. Entry Accounts Debit Credit Consolidation Worksheet Entries Record the excess value (differential) reclassification entry. Note: Enter debits before credits. Entry Accounts Debit Credit 2 Consolidation Worksheet Entries Record the entry to eliminate the intercompany accounts. Note: Enter debits before credits Entry Accounts Debit Credit Consolidation Worksheet Entries Record the optional accumulated depreciation consolidation entry. Note: Enter debits before credits. Entry Accounts Debit Credit 4 entered as positive values. For accounts where multiple adjusting 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.) PHONE CORPORATION AND SUBSIDIARY Consolidated Balance Sheet December 31, 20X4 Consolidation Entries Phone Corp. Smart Corp DR CR Consolidated Assets Cash Accounts receivable Inventory Land Buildings and equipment Less: Accumulated depreciation Investment in Smart Corporation Total Assets Liabilities and Equity Accounts payable Mortgage payable Common stock Retained earnings NCl in NA of Smart Corporation Total Liabilities and Eauitv 0 $ 0 0l $ 0l $ Consolidated Balance Sheet December 31, 20X4 Assets Total Assets Liabilities Stockholders' Equity Controlling Interest Total Controlling Interest Total Stockholders' equity Total Liabilities and Stockholders' Eauitv