Price Corporation acquired 100 percent ownership of Saver Company on January 1, 20x8, for $158,000. At that date, the fair value of Saver's buildings and equipment was $32,000 more than the book value. Buildings and equipment are depreciated on a 10-year basis. Although goodwill is not amortized, Price's management concluded at December 31, 20x8, that goodwill involved in its acquisition of Saver shares had been impaired and the correct carrying value was $5,500. Trial balance data for Price and Saver on December 31, 20x8, are as follows: Price Corporation Saver Company Item Debit Credit Debit Credit Cash $ 22,500 $ 27,000 Accounts Receivable 76,000 15,000 Inventory 96,000 31,000 Land 36,000 21,000 Buildings & Equipment 335,000 156,000 Investment in Saver Company 148,300 Cost of Goods Sold 131,000 95,000 Wage Expense 66,000 30,000 Depreciation Expense 28,000 13,000 Interest Expense 15,000 7,000 Other Expenses 25,500 20,000 Dividends Declared 36,000 19,000 Accumulated Depreciation 148,000 $ 70,000 Accounts Payable 75,000 22,000 Wages Payable 23,000 12,000 Notes Payable 156,000 32,000 Common Stock 206,000 60,000 Retained Earnings 108,000 40,000 Sales 290,000 198,000 Income from Saver Company 9,300 $1,015,300 $1,015,300 $434,000 $434,000 $ Required: a. Prepare the following consolidating entries needed to prepare a three-part consolidation worksheet as of December 31, 20x8. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Required: a. Prepare the following consolidating entries needed to prepare a three-part consolidation worksheet as of December 31, 20X8. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) view transaction list X: Record the basic consolidation entry. > Record the amortized excess value reclassification entry. Record the excess value (differential) reclassification entry. Record the optional accumulated depreciation consolidation entry. Credit 19,000 114,000 Note : journal entry has been entered No Event Credit A 1 Accounts Common stock Retained earnings Income from Saver Company Dividends declared Investment in Saver Company Debit 60,000 40,000 33,000 19,000 114,000 B 2 3,200 Depreciation expense Goodwill impairment loss Income from Saver Company 3 32,000 Buildings and equipment Goodwill Accumulated depreciation Investment in Saver Company 3,200 D 4 Accumulated depreciation Buildings and equipment b. Prepare a three-part consolidation worksheet for 20x8. (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.) PRICE CORPORATION AND SUBSIDIARY Consolidated Financial Statements Worksheet December 31, 20x8 Consolidation Entries DR CR Price Corp. Saver Co. Consolidated Income Statement Sales Less: COGS $ $ 290,000 $ (131,000) (66,000) (28,000) (15,000) (25,500) 198,000 (95.000) (30,000) (13,000) (7.000) (20,000) 488,000 (226,000) (96,000) (41,000) (22,000) (45,500) $ 24,500 $ 33,000 $ 0 $ 0 $ 57.500 Less: Wage expense Less: Depreciation expense Less: Interest expense Less: Other expenses Less: Impairment loss Income from Saver Co. Net Income Statement of Retained Earnings Beginning balance Net income Less: Dividends declared Ending Balance Assets Cash (36,000) (36.000) $ (19,000) (19,000) $ (55,000) (55,000) $ 0 $ 0 $ $ 22,500 $ 27,000 $ 49,500 (15,000) (25,500) (7,000) (20,000) (22,000) (45,500) $ 24,500 $ 33,000 $ 0 $ 0 $ 57,500 (36,000) (36,000) $ (19,000) (19,000) $ (55,000) (55,000) $ 0 $ 0 $ $ $ Less: Interest expense Less: Other expenses Less: Impairment loss Income from Saver Co. Net Income Statement of Retained Earnings Beginning balance Net income Less: Dividends declared Ending Balance Assets Cash Accounts receivable Inventory Land Buildings & equipment Less: Accumulated depreciation Investment in Saver Co. Goodwill Total Assets Liabilities & Stockholders' Equity Accounts payable Wages payable Notes payable Common stock Retained earnings Total Liabilities & Equity 22,500 $ 76,000 96,000 36,000 335,000 (148,000) 27,000 15,000 31,000 21,000 156,000 (70,000) 49,500 91,000 127,000 57,000 491,000 (218,000) $ 417,500 $ 180,000 $ 0 $ 0 $ 597,500 $ $ 75,000 $ 23,000 56,000 206,000 22,000 12,000 32,000 60,000 97,000 35,000 88,000 266,000 $ 360,000 $ 126,000 $ $ 0 $ 486,000 Price Corporation acquired 100 percent ownership of Saver Company on January 1, 20x8, for $158,000. At that date, the fair value of Saver's buildings and equipment was $32,000 more than the book value. Buildings and equipment are depreciated on a 10-year basis. Although goodwill is not amortized, Price's management concluded at December 31, 20x8, that goodwill involved in its acquisition of Saver shares had been impaired and the correct carrying value was $5,500. Trial balance data for Price and Saver on December 31, 20x8, are as follows: Price Corporation Saver Company Item Debit Credit Debit Credit Cash $ 22,500 $ 27,000 Accounts Receivable 76,000 15,000 Inventory 96,000 31,000 Land 36,000 21,000 Buildings & Equipment 335,000 156,000 Investment in Saver Company 148,300 Cost of Goods Sold 131,000 95,000 Wage Expense 66,000 30,000 Depreciation Expense 28,000 13,000 Interest Expense 15,000 7,000 Other Expenses 25,500 20,000 Dividends Declared 36,000 19,000 Accumulated Depreciation 148,000 $ 70,000 Accounts Payable 75,000 22,000 Wages Payable 23,000 12,000 Notes Payable 156,000 32,000 Common Stock 206,000 60,000 Retained Earnings 108,000 40,000 Sales 290,000 198,000 Income from Saver Company 9,300 $1,015,300 $1,015,300 $434,000 $434,000 $ Required: a. Prepare the following consolidating entries needed to prepare a three-part consolidation worksheet as of December 31, 20x8. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Required: a. Prepare the following consolidating entries needed to prepare a three-part consolidation worksheet as of December 31, 20X8. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) view transaction list X: Record the basic consolidation entry. > Record the amortized excess value reclassification entry. Record the excess value (differential) reclassification entry. Record the optional accumulated depreciation consolidation entry. Credit 19,000 114,000 Note : journal entry has been entered No Event Credit A 1 Accounts Common stock Retained earnings Income from Saver Company Dividends declared Investment in Saver Company Debit 60,000 40,000 33,000 19,000 114,000 B 2 3,200 Depreciation expense Goodwill impairment loss Income from Saver Company 3 32,000 Buildings and equipment Goodwill Accumulated depreciation Investment in Saver Company 3,200 D 4 Accumulated depreciation Buildings and equipment b. Prepare a three-part consolidation worksheet for 20x8. (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.) PRICE CORPORATION AND SUBSIDIARY Consolidated Financial Statements Worksheet December 31, 20x8 Consolidation Entries DR CR Price Corp. Saver Co. Consolidated Income Statement Sales Less: COGS $ $ 290,000 $ (131,000) (66,000) (28,000) (15,000) (25,500) 198,000 (95.000) (30,000) (13,000) (7.000) (20,000) 488,000 (226,000) (96,000) (41,000) (22,000) (45,500) $ 24,500 $ 33,000 $ 0 $ 0 $ 57.500 Less: Wage expense Less: Depreciation expense Less: Interest expense Less: Other expenses Less: Impairment loss Income from Saver Co. Net Income Statement of Retained Earnings Beginning balance Net income Less: Dividends declared Ending Balance Assets Cash (36,000) (36.000) $ (19,000) (19,000) $ (55,000) (55,000) $ 0 $ 0 $ $ 22,500 $ 27,000 $ 49,500 (15,000) (25,500) (7,000) (20,000) (22,000) (45,500) $ 24,500 $ 33,000 $ 0 $ 0 $ 57,500 (36,000) (36,000) $ (19,000) (19,000) $ (55,000) (55,000) $ 0 $ 0 $ $ $ Less: Interest expense Less: Other expenses Less: Impairment loss Income from Saver Co. Net Income Statement of Retained Earnings Beginning balance Net income Less: Dividends declared Ending Balance Assets Cash Accounts receivable Inventory Land Buildings & equipment Less: Accumulated depreciation Investment in Saver Co. Goodwill Total Assets Liabilities & Stockholders' Equity Accounts payable Wages payable Notes payable Common stock Retained earnings Total Liabilities & Equity 22,500 $ 76,000 96,000 36,000 335,000 (148,000) 27,000 15,000 31,000 21,000 156,000 (70,000) 49,500 91,000 127,000 57,000 491,000 (218,000) $ 417,500 $ 180,000 $ 0 $ 0 $ 597,500 $ $ 75,000 $ 23,000 56,000 206,000 22,000 12,000 32,000 60,000 97,000 35,000 88,000 266,000 $ 360,000 $ 126,000 $ $ 0 $ 486,000