Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

PLEASE WRITE OUT ALL ANSWERS. NO EXCEL SHEETS On January 1, 2018, Piper Company acquired an 80% interest in Sand Company for $2,276,000. At that

image text in transcribed

PLEASE WRITE OUT ALL ANSWERS. NO EXCEL SHEETS

On January 1, 2018, Piper Company acquired an 80% interest in Sand Company for $2,276,000. At that time the capital stock and retained earnings of Sand Company were $1,800,000 and $700,000, respectively. Differences between the fair value and the book value of the identifiable assets of Sand Company were as follows: Fair Value in Excess of Book Value Inventory $45,000 Equipment (net) 50,000 The book values of all other assets and liabilities of Sand Company were equal to their fair values on January 1, 2018. The equipment had a remaining useful life of eight years. Inventory is accounted for on a FIFO basis. Sand Company's reported net income and declared dividends for 2018 through 2020 are shown here: 2018 2019 2020 Net Income $100,000 $150,000 $80,000 Dividends 20,000 30,000 15,000 Required: Prepare the eliminating/adjusting entries needed on the consolidated worksheet for the years ended 2018, 2019, and 2020. (It is not necessary to prepare the worksheet.) 1. Assume the use of the cost method. 2. Assume the use of the partial equity method. 3. Assume the use of the complete equity method

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting Theory Conceptual Issues In A Political And Economic Environment

Authors: Harry I. Wolk, James L. Dodd, John J. Rozycki

7th Edition

1412953456, 978-1412953450

More Books

Students also viewed these Accounting questions

Question

Does it highlight your accomplishments rather than your duties?

Answered: 1 week ago

Question

Does it clearly identify what you have done and accomplished?

Answered: 1 week ago

Question

Does it avoid using personal pronouns (such as I and me)?

Answered: 1 week ago