Question
Parrots Company purchased a 80% interest in Shiprecks Corporation for $1,050,000 on January 1, 2019. On acquision date, Shiprecks Corporation had: Common Stock 50,000, Retained
Parrots Company purchased a 80% interest in Shiprecks Corporation for $1,050,000 on January 1, 2019.
On acquision date, Shiprecks Corporation had: Common Stock 50,000, Retained Earnings 600,000 , Total 650,000.
The following values were determined for Shiprecks Corporation on the date of purchase, with any balance going to Goodwill.
Book Value: Inventory $700,000, Land 545,000, Equipment 1,650,000.
Fair Value. Inventory $825,000, Land 760,000, Equipment 1,780,000.
Notes: Inventory is sold in 2019, Equipment has 5 yrs remaining useful life.
Shipreck Corporation uses the Complete Equity Method and had the following on their books. 2019 net income $435,000 , dividends declared 200,000.
Prepare ALL consolidating workpaper journal entries for 2019.
Step by Step Solution
3.41 Rating (157 Votes )
There are 3 Steps involved in it
Step: 1
Date Account Dr Cr 20191231 Statement of Profit and Lo...
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Business Communication Building Critical Skills
Authors: Kitty Locker, Stephen Kaczmarek
6th edition
978-0073403267, 73403261, 978-0077637200, 77637208, 978-0077637194
