Please use your words Avoid plagiarism The solution must be from your words and there is no similarity 1) Plant Inc a calendar year reporting company acquired 80 of Seed Inc s outstanding common stock for $ 484,000 on Dec 31, 2018, when the fair value of Seeds Net Assets was $ 568,000 The following data summarize the fair value calculation (2 Marks) Book Value Element Amount $ Life Remaining Common Stock 150,000 Retained Earnings 135,000 Under Or Over Valuation Inventory (9700) 2 Months Land 48,000 Indefinite Equipment 96,000 8 Years Covenant Not To Compete 40,000 5 Years Goodwill Element 108,700 Indefinite Total Cost 568,000 Plant Inc Seed Inc Worksheet As at Dec 31, 2018 Balance Sheet Plant ($) Seed ($) Cash 148,000 47,000 Account Receivable 103,500 118,000 Inventory 152,500 126,000 Investment in Seed Book Value 228,000 Excess Cost 226,400 Land 168,000 127,000 Building Equipment 400,000 309,000 Accumulated Depreciation 16,000 102,000 Total Assets 1,410,400 625,000 Payable Accruals 265,400 120,000 Long Term Assets 290,000 220,000 Common Stock 450,000 150,000 Retained Earnings 405,000 135,000 Total Liabilities Equity 1,410,400 625,000 You are required to (a) Prepare an Analysis of the Investment Account Through Dec 31, 2018 Show clearly Book Value and Excess Value calculation by preparing tables (b) Prepare all consolidation (Elimination Entries) as of Dec 31, 2018 (c) Prepare a Consolidated Worksheet as at Dec 31, 2018 2) The following intercompany transactions occurred during the year (1 5 Marks) Parent loaned $12500 to Sub To keep things simple, assume that there is no interest revenue or interest expense associated with this loan Parent made a sale to Sub for $13000 cash The inventory had originally cost Parent $12220 Sub then sold that same inventory to an outsider for $14000 Parent made a sale to Sub for $15000 cash The inventory had originally cost Parent $11280 Sub has not yet sold that same inventory to an outsider (Dont forget equity method entry ) Based on our conceptual discussion, what consolidation worksheet entries would you make 3) Peter Corp purchased a machine on Jan 1, 2011 for $ 120,000 and estimated that the machine would have a useful life of 10 years with no salvage value After two years, on Dec 31, 2012, Peter corp sold the machine to its 100 owned subsidiary, Sonu Co for $ 100,000 Sonu Co estimated that the asset had a remaining useful life of five years What is the amount of the gain or loss recorded by Peter Corp at the time of the fixed transfer What balance would have existed if the transfer had not taken place Show the worksheet entry on Dec 31, 2012 to eliminate the asset transfer to make adjustment to change form Actual to As If the asset hadnt been transferred (1 5 Marks)

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Please use your words Avoid plagiarism The solution must be from your words and there is no similarity 1) Plant Inc. a calendar year reporting

Please use your words Avoid plagiarism The solution must be from your words and there is no similarity

1) Plant Inc. a calendar year reporting company acquired 80% of Seed Inc.s outstanding common stock for $ 484,000 on Dec. 31, 2018, when the fair value of Seeds Net Assets was $ 568,000. The following data summarize the fair value calculation: (2 Marks)

Book Value Element	Amount $	Life Remaining
Common Stock	150,000
Retained Earnings	135,000

Under Or-Over Valuation
Inventory	(9700)	2 Months
Land	48,000	Indefinite
Equipment	96,000	8 Years
Covenant Not-To Compete	40,000	5 Years
Goodwill Element	108,700	Indefinite
Total Cost	568,000

Plant Inc. & Seed Inc.

Worksheet

As at Dec. 31, 2018

Balance Sheet	Plant ($)	Seed ($)
Cash	148,000	47,000
Account Receivable	103,500	118,000
Inventory	152,500	126,000
Investment in Seed -
Book Value	228,000
Excess Cost	226,400
Land	168,000	127,000
Building & Equipment	400,000	309,000
Accumulated Depreciation	-16,000	-102,000
Total Assets	1,410,400	625,000

Payable & Accruals	265,400	120,000
Long Term Assets	290,000	220,000
Common Stock	450,000	150,000
Retained Earnings	405,000	135,000
Total Liabilities & Equity	1,410,400	625,000

You are required to

(a) Prepare an Analysis of the Investment Account Through Dec. 31, 2018. Show clearly Book Value and Excess Value calculation by preparing tables.

(b) Prepare all consolidation (Elimination Entries) as of Dec. 31, 2018.

2) The following intercompany transactions occurred during the year:

(1.5 Marks)

Parent loaned $12500 to Sub. To keep things simple, assume that there is no interest revenue or interest expense associated with this loan.
Parent made a sale to Sub for $13000 cash. The inventory had originally cost Parent $12220. Sub then sold that same inventory to an outsider for $14000.
Parent made a sale to Sub for $15000 cash. The inventory had originally cost Parent $11280. Sub has not yet sold that same inventory to an outsider. (Dont forget equity method entry!)

Based on our conceptual discussion, what consolidation worksheet entries would you make?

3) Peter Corp. purchased a machine on Jan 1, 2011 for $ 120,000 and estimated that the machine would have a useful life of 10 years with no salvage value. After two years, on Dec. 31, 2012, Peter corp. sold the machine to its 100 % owned subsidiary, Sonu Co. for $ 100,000. Sonu Co. estimated that the asset had a remaining useful life of five years.

What is the amount of the gain or loss recorded by Peter Corp. at the time of the fixed transfer? What balance would have existed if the transfer had not taken place?

Show the worksheet entry on Dec. 31, 2012 to eliminate the asset transfer to make adjustment to change form Actual to As If the asset hadnt been transferred.

(1.5 Marks)