Problem $3-26($Algo$)$ Consolidated Worksheet and Balance Sheet on the Acquisition Date $($Equity Method$)$ LO $3-4,3-5$

Peanut Company acquired $80$ percent of Snoopy Company$$s outstanding common stock for $$272,000$ on January $1,20$X$8,$ when the book value of Snoopy$$s net assets was equal to $$340,000.$ Peanut uses the equity method to account for investments. Trial balance data for Peanut and Snoopy as of January $1,20$X$8,$ follow:

Peanut Company Snoopy Company

Assets

Cash $ $60,000$ $ $23,000$

Accounts Receivable $55,00033,000$

Inventory $117,00067,000$

Investment in Snoopy Company $272,000$

Land $229,000102,000$

Buildings and Equipment $718,000216,000$

Accumulated Depreciation $(387,000)(8,000)$

Total Assets $ $1,064,000$ $ $433,000$

Liabilities and Stockholders$$ Equity

Accounts Payable $ $73,000$ $ $20,000$

Bonds Payable $199,00073,000$

Common Stock $487,000199,000$

Retained Earnings $305,000141,000$

Total Liabilities and Equity $ $1,064,000$ $ $433,000$

Required:

Prepare the journal entry on Peanut's books for the acquisition of Snoopy on January $1,20$X$8.$

Prepare a consolidation worksheet on the acquisition date, January $1,20$X$8.$

Prepare a consolidated balance sheet on the acquisition date, January $1,20$X$8.$