Pizza Corporation acquired 80 percent ownership of Slice Products Company on January 1, 20X1, for $154,000. On that date, the fair value of the noncontrolling interest was $38,500, and Slice reported retained earnings of $46,000 and had $98,000 of common stock outstanding. Pizza has used the equity method in accounting for its investment in Slice.
Trial balance data for the two companies on December 31, 20X5, are as follows:
Pizza
Corporation Slice
Products Company
Item Debit Credit Debit Credit
Cash & Receivables $ 82,000 $ 81,000
Inventory 265,000 104,000
Land 88,000 88,000
Buildings & Equipment 518,000 163,000
Investment in Slice Products Company 186,280
Cost of Goods Sold 114,000 46,000
Depreciation Expense 21,000 11,000
Inventory Losses 11,000 5,000
Dividends Declared 44,000 20,400
Accumulated Depreciation $ 185,000 $ 77,000
Accounts Payable 55,000 16,000
Notes Payable 259,760 134,400
Common Stock 288,000 98,000
Retained Earnings 302,000 88,000
Sales 209,000 105,000
Income from Slice Products Company 30,520
$ 1,329,280 $ 1,329,280 $ 518,400 $ 518,400
Additional Information
On the date of combination, the fair value of Slice's depreciable assets was $48,500 more than book value. The accumulated depreciation on these assets was $10,000 on the acquisition date. The differential assigned to depreciable assets should be written off over the following 10-year period.
There was $14,000 of intercorporate receivables and payables at the end of 20X5.
Required:
a. Prepare all journal entries that Pizza recorded during 20X5 related to its investment in Slice. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Pizza Corporation acquired 80 percent ownership of Slice Products Company of January 1, 20X1. for $154.000. On that date, the fair value of the noncontrolling interest was $38,500, and Slice reported retained earnings of $46,000 and had $98,000 of common stock outstanding. Pizza has used the equity method in accounting for its investment in Slice. Trial balance data for the two companies on December 31, 20X5, are as follows Cac Budget investment Products Company Cost of Goods Soad Den En yo Andere AP Nyt Common Stock RE Income from Products Company Additional Information 1. On the date of combination, the fair value of Slice's depreciable assets was $48.500 more than book value. The accumulated depreciation on these asset was $10,000 on the acquisition date. The differential assigned to depreciable assets should be written off over the following 10-year period 2. There was $14,000 of intercorporate receivables and payables at the end of 20x5 Required: a. Prepare all journal entries that Pizza recorded during 20x5 related to its investment in Slice. (If no entry is required for a transaction/event, select " journal entry required in the first account field.) Journal entry worksheet b. Prepare all consolidation entries needed to prepare consolidated statements 20X5. (If no entry is required for a transactionlevent, select "No journal en required in the first account field.) Consolidation Worksheet Entries c. Prepare a three-part worksheet as of December 31, 20X5. (Values in the first two columns (the "parent" and "subsidiary balances) that are to be deducted should be indicated with a minus sign, while all values in the "Consolidation Entries" columns should be 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.) Pizza Corporation acquired 80 percent ownership of Slice Products Company on January 1, 20X1, for $154,000. On that date, the fair value of the noncontrolling interest was $38,500, and Slice reported retained earnings of $46,000 and had $98,000 of common stock outstanding. Pizza has used the equity method in accounting for its investment in Slice. Trial balance data for the two companies on December 31, 20X5, are as follows: $ Item Cash & Receivables Inventory Land Buildings & Equipment Investment in Slice Products Company Cost of Goods Sold Depreciation Expense Inventory Losses Dividends Declared Puza Corporation Debit Credit 82,000 265,000 88,000 518,000 186,280 114,000 21,000 11,000 44 000 Slico Products Company Debit Credit $ 81,000 104.000 88,000 163,000 46,000 11.000 5,000 20 400 Dividends Declared Accumulated Depreciation Accounts Payable Notes Payable Common Stock Retained Earnings Sales Income from Slice Products Company 44,000 20.400 $ 185,000 $ 77,000 55 000 16.000 259.760 134.400 288.000 98.000 302.000 88.000 209.000 105.000 30.520 $1.329.280 $1.329.280 S518 400 $518.400 Additional Information 1. On the date of combination, the fair value of Slice's depreciable assets was $48,500 more than book value. The accumulated depreciation on these assets was $10,000 on the acquisition date. The differential assigned to depreciable assets should be written off over the following 10-year period. 2. There was $14,000 of intercorporate receivables and payables at the end of 20X5. Required: a. Prepare all journal entries that Pizza recorded during 20X5 related to its investment in Slice. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) JOU HU YU CH SUCCULE View transactionist Journal entry worksheet ABC Record Pizza Corporation.'s 80% share of Slice Wood Company's 20x5 income. Note: Enter debits before credits Event General Journal Debit Credit Record entry Clear entry view consolidation entries c. Prepare a three-part worksheet as of December 31, 20X5. (Values in the first two columns (the "parent" and "subsidiary" balances) that are to be deducted should be indicated with a minus sign, while all values in the "Consolidation Entries" columns should be 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.) PIZZA CORPORATION AND SUBSIDIARY Worksheet for Consolidated Financial Statements December 31, 20X5 Consolidation Entries Pizza Corp. Slice Products Co. DR CR Consolidated Pizza Corporation acquired 80 percent ownership of Slice Products Company of January 1, 20X1. for $154.000. On that date, the fair value of the noncontrolling interest was $38,500, and Slice reported retained earnings of $46,000 and had $98,000 of common stock outstanding. Pizza has used the equity method in accounting for its investment in Slice. Trial balance data for the two companies on December 31, 20X5, are as follows Cac Budget investment Products Company Cost of Goods Soad Den En yo Andere AP Nyt Common Stock RE Income from Products Company Additional Information 1. On the date of combination, the fair value of Slice's depreciable assets was $48.500 more than book value. The accumulated depreciation on these asset was $10,000 on the acquisition date. The differential assigned to depreciable assets should be written off over the following 10-year period 2. There was $14,000 of intercorporate receivables and payables at the end of 20x5 Required: a. Prepare all journal entries that Pizza recorded during 20x5 related to its investment in Slice. (If no entry is required for a transaction/event, select " journal entry required in the first account field.) Journal entry worksheet b. Prepare all consolidation entries needed to prepare consolidated statements 20X5. (If no entry is required for a transactionlevent, select "No journal en required in the first account field.) Consolidation Worksheet Entries c. Prepare a three-part worksheet as of December 31, 20X5. (Values in the first two columns (the "parent" and "subsidiary balances) that are to be deducted should be indicated with a minus sign, while all values in the "Consolidation Entries" columns should be 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.) Pizza Corporation acquired 80 percent ownership of Slice Products Company on January 1, 20X1, for $154,000. On that date, the fair value of the noncontrolling interest was $38,500, and Slice reported retained earnings of $46,000 and had $98,000 of common stock outstanding. Pizza has used the equity method in accounting for its investment in Slice. Trial balance data for the two companies on December 31, 20X5, are as follows: $ Item Cash & Receivables Inventory Land Buildings & Equipment Investment in Slice Products Company Cost of Goods Sold Depreciation Expense Inventory Losses Dividends Declared Puza Corporation Debit Credit 82,000 265,000 88,000 518,000 186,280 114,000 21,000 11,000 44 000 Slico Products Company Debit Credit $ 81,000 104.000 88,000 163,000 46,000 11.000 5,000 20 400 Dividends Declared Accumulated Depreciation Accounts Payable Notes Payable Common Stock Retained Earnings Sales Income from Slice Products Company 44,000 20.400 $ 185,000 $ 77,000 55 000 16.000 259.760 134.400 288.000 98.000 302.000 88.000 209.000 105.000 30.520 $1.329.280 $1.329.280 S518 400 $518.400 Additional Information 1. On the date of combination, the fair value of Slice's depreciable assets was $48,500 more than book value. The accumulated depreciation on these assets was $10,000 on the acquisition date. The differential assigned to depreciable assets should be written off over the following 10-year period. 2. There was $14,000 of intercorporate receivables and payables at the end of 20X5. Required: a. Prepare all journal entries that Pizza recorded during 20X5 related to its investment in Slice. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) JOU HU YU CH SUCCULE View transactionist Journal entry worksheet ABC Record Pizza Corporation.'s 80% share of Slice Wood Company's 20x5 income. Note: Enter debits before credits Event General Journal Debit Credit Record entry Clear entry view consolidation entries c. Prepare a three-part worksheet as of December 31, 20X5. (Values in the first two columns (the "parent" and "subsidiary" balances) that are to be deducted should be indicated with a minus sign, while all values in the "Consolidation Entries" columns should be 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.) PIZZA CORPORATION AND SUBSIDIARY Worksheet for Consolidated Financial Statements December 31, 20X5 Consolidation Entries Pizza Corp. Slice Products Co. DR CR Consolidated
