REQUIREMENT 1 - PREPARE THE NECESSARY JOURNAL ENTRIES:

a) Record the entry related to the purchase. b) Record the entry related to the net income. c) Record the entry related to the dividends. d) Record the entry related to the inventory adjustment. e) Record the entry related to the depreciation adjustment. REQUIREMENT 2 & 3:

REQUIREMENT 4:

Northwest Paperboard Company, a paper and allied products manufacturerwas seeking to gain a foothold in Canada. Toward that endthe company bought 40% of the outstanding common shares of Vancouver Timber and Milling, Inc, on January 2, 2018, for $560 million. At the date of purchase, the book value of Vancouvers net assets was $855 million. The book values and fair values for all balance sheet items were the same except for inventory and plant facilities. The fair value exceeded book value by $5 million for the inventory and by $30 million for the plant facilities. The estimated useful life of the plant facilities is 15 years. All inventory acquired was sold during 2018. Vancouver reported net income of $180 million for the year ended December 31, 2018. Vancouver paid a cash dividend of $20 million