Priya Corporation acquired 100 percent of Sheldon Company stock on January 1, 2020 for $780,000 cash. Following are pre-closing trial balance amounts for Priya Corporation and Sheldon Company as of December 31, 2020: SHELDON CORPORATION Debit Credit $262,700 149,000 195,000 Cash Accounts Receivable Inventory Investment in Sheldon Corp. Buildings Land Equipment Cost of Goods Sold Depreciation Expense, Building Depreciation Expense, Equipment Selling & Administrative Expense Dividends Declared Accumulated Depreciation, Bldg Accumulated Depreciation, Equip Accounts Payable Bonds Payable Common Stock ($1 par) Additional Paid In Capital Retained Earnings (01/01/2020) Sales Income from Sheldon Corp. PRIYA CORPORATION Debit Credit $753,600 249,000 437,000 886,200 652,000 709,000 513,000 328,000 56,800 43,100 137,000 70,000 $227,200 172,400 187,000 450,000 695,000 1,258,500 908,000 790,400 146,200 $4,834,700 $4,834,700 169,000 283,000 232,000 207,000 19,200 23,400 116,800 40,000 $57,600 93,600 174,900 78,400 273,000 348,000 159,000 512,600 $1,697,100 $1,697,100 Additional Information: 1. On January 1, 2020, the book values of Sheldon's net assets and liabilities approximated fair values. 2. Priya Corporation uses the equity method to account for its Investment in Sheldon Company. 3. The general ledger numbers given above (HINT: those in boldface) include the effects of the JOURNAL ENTRIES that were recorded by Priya at the acquisition date and during 2020 to account for its investment in Sheldon Company. These boldface figures should be used as check figures for your solution. 1 e. Prepare the consolidation worksheet for the period ended December 31, 2020. Use the template provided below. (20 POINTS) PRIYA CORPORATION Consolidation Worksheet For the Period Ending December 31, 2020 PRIYA'S SHELDON'S G/L CONSOLIDATION ENTRIES Debit Credit Consolidated Totals G/L Accounts Income Statement Sales Less: Cost of Goods Sold Less: Depreciation Expense, Building Less: Depreciation Expense, Equipment Less: Selling & Administrative Expense Income from Sheldon Corp. Net Income $ $ $ $ $ 790,400 (328,000) (56,800) (43,100) (137,000) 146,200 371,700 $ $ $ $ $ 512,600 (207,000) (19,200) (23,400) (116,800) $ $ 146,200 Statement of Retained Earnings Retained Earnings (01/01/2020) Net income (above) Dividends Declared Retained earnings, 12/31/20 $ $ $ $ 908,000 $ 371,700 $ (70,000) $ 1,209,700 $ 159,000 146,200 (40,000) 265,200 $ $ $ 262,700 149,000 195,000 Balance Sheet Cash Accounts Receivable Inventory Investment in Sheldon Corp. Buildings Land Equipment Accumulated Depreciation, Bldg Accumulated Depreciation, Equip Total Assets $ $ $ $ $ $ $ $ $ $ 753,600 249,000 437,000 886,200 652,000 709,000 513,000 (227,200) (172,400) 3,800,200 $ $ $ $ $ $ 169,000 283,000 232,000 (57,600) (93,600) 1,139,500 187,000 450,000 Accounts Payable Bonds Payable Common Stock ($1 par) Additional Paid In Capital Retained earnings, 12/31/20 (above) Total Liabilities & Stockholders' Equity $ $ $ $ $ $ $ 695,000 1,258,500 1,209,700 3,800,200 $ $ $ $ $ $ 174,900 78,400 273,000 348,000 265,200 1,139,500 $ 926,200 $ 926,200 NET ASSETS ASSETS - LIABILITIES TOTAL STOCKHOLDERS' EQUITY 3