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Public Company acquired 85% of the common stock of Sample Company on January 1st, Year One, for $510,000 On that date, Sample had the following

Public Company acquired 85% of the common stock of Sample Company on January 1st, Year One, for $510,000

On that date, Sample had the following trial balance:

Account Debit Credit

Additional paid in capital 100,000

Building(12 year life) 250,000

Common Stock 170,000

Current assets 170,000

Equipment(6 yr life) 160,000

Land 110,000

Liabilities(due in 4 yrs) 300,000

Retained earnings 1/year 1 120,000

Totals $690,000 $690,000

During year one, Sample reported net income of $60,000

During year one, Sample paid dividends of $30,000

During year two, Sample reported net income of $80,000

During year two, Sample paid dividends of $40,000

On January 1, year one, fair values were:

Land $146,000

Building 274,000

Equipment 196,000

There was no impairment of any goodwill arising from he acquisition.

Use the data for the Public Company acquisition of the Sample Company to prepare the consolidation worksheet entries for December 31 of year one.

For clarity use the entry labels S, A, I and so on.

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