Pizza Corporation acquired 80 percent ownership of Slice Products Company on January 1, 20X1, for $142,000. On that date, the fair value of the noncontrolling Interest was $35,500, and Slice reported retained earnings of $40,000 and had $92,000 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: $ Slice Products Company Debit Credit $ 67,000 101,600 88,000 157, eee Item Cash & Receivables Inventory Land Buildings & Equipment Investment in slice Products Company Cost of Goods Sold Depreciation Expense Inventory Losses Dividends Declared Accumulated Depreciation Accounts Payable Notes Payable Common Stock Retained Earnings Sales Income from Slice Products Company Pizza Corporation Debit Credit 91,080 263,00 88,000 504,000 175,640 114,000 20,000 10, 35,00 $ 203,00 51,000 231,080 284, 298,eee 202, eee 31,560 40,00 10,000 6,000 21,200 $ 70,000 13,000 133,200 92,000 82,000 100,000 $1,300,640 $1,308,548 $490,200 $490,200 Additional Information 1. On the date of combination, the fair value of Slice's depreciable assets was $45,500 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 $12,000 of Intercorporate recevables 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.) View transaction list Journal entry worksheet 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 general journal b. Prepare all consolidation entries needed to prepare consolidated statements for 20X5. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) view transaction list Consolidation Worksheet Entries B C D Record basic consolidation entry. Note: Enter debits before credits. Event Accounts 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 "sub 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 Income Statement Sales Less: COGS Less: Depreciation expense Less: Inventory losses Income from Slice Products Company Consolidated net income NCI in net income Controlling Interest in Net Income Statement of Retained Earnings Beginning balance Net income Less: Dividends declared Ending Balance Balance Sheet Cash and receivables Inventory Land Buildings and equipment Less: Accumulated depreciation Investment in Slice Products Company Total Assets Accounts payable Notes payable Common stock Retained earnings NCI in NA of Slice Products Company Total Liabilities and Equity Pizza Corporation acquired 80 percent ownership of Slice Products Company on January 1, 20X1, for $142,000. On that date, the fair value of the noncontrolling Interest was $35,500, and Slice reported retained earnings of $40,000 and had $92,000 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: $ Slice Products Company Debit Credit $ 67,000 101,600 88,000 157, eee Item Cash & Receivables Inventory Land Buildings & Equipment Investment in slice Products Company Cost of Goods Sold Depreciation Expense Inventory Losses Dividends Declared Accumulated Depreciation Accounts Payable Notes Payable Common Stock Retained Earnings Sales Income from Slice Products Company Pizza Corporation Debit Credit 91,080 263,00 88,000 504,000 175,640 114,000 20,000 10, 35,00 $ 203,00 51,000 231,080 284, 298,eee 202, eee 31,560 40,00 10,000 6,000 21,200 $ 70,000 13,000 133,200 92,000 82,000 100,000 $1,300,640 $1,308,548 $490,200 $490,200 Additional Information 1. On the date of combination, the fair value of Slice's depreciable assets was $45,500 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 $12,000 of Intercorporate recevables 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.) View transaction list Journal entry worksheet 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 general journal b. Prepare all consolidation entries needed to prepare consolidated statements for 20X5. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) view transaction list Consolidation Worksheet Entries B C D Record basic consolidation entry. Note: Enter debits before credits. Event Accounts 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 "sub 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 Income Statement Sales Less: COGS Less: Depreciation expense Less: Inventory losses Income from Slice Products Company Consolidated net income NCI in net income Controlling Interest in Net Income Statement of Retained Earnings Beginning balance Net income Less: Dividends declared Ending Balance Balance Sheet Cash and receivables Inventory Land Buildings and equipment Less: Accumulated depreciation Investment in Slice Products Company Total Assets Accounts payable Notes payable Common stock Retained earnings NCI in NA of Slice Products Company Total Liabilities and Equity