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a. What balance does Haynes's Investment in Turner account show on December 31, 2021, when the equity method is applied? b. What is the consolidated net income for the year ending December 31, 2021? c-1. What is the consolidated equipment balance as of December 31, 2021? c-2. Would this answer be affected by the investment method applied by the parent? Show less A Investment in Turner account

a. What balance does Haynes's Investment in Turner account show on December 31, 2021, when the equity method is applied? b. What is the consolidated net income for the year ending December 31, 2021? c-1. What is the consolidated equipment balance as of December 31, 2021? c-2. Would this answer be affected by the investment method applied by the parent? Show less A Investment in Turner account

Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter12: Intangibles
Section: Chapter Questions
Problem 18E
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Haynes, Inc., obtained 100 percent of Turner Company's common stock on January 1, 2020, by issuing 11,200 shares of $10 par value common stock. Haynes's shares had a $15 per share fair value. On that date, Turner reported a net book value of $120,200. However, its equipment (with a five-year remaining life) was undervalued by $8,700 in the company's accounting records. Also, Turner had developed a customer list with an assessed value of $39.100, although no value had been recorded on Turner's books. The customer list had an estimated remaining useful life of 10 years. The following balances come from the individual accounting records of these two companies as of December 31, 2020: Haynes Turner $ (638,000) $ (351,000) Revenues Expenses 465,000 191,000 Investment income Not given Dividends declared 90,000 80,000 The following balances come from the individual accounting records of these two companies as of December 31, 2021: Haynes Turner Revenues $ (776,000) $ (407,500) Expenses 486,500 Investment income Dividends declared Not given 110,000 222,900 e 60,000 311,000 Equipment 510,000 a. What balance does Haynes's Investment in Turner account show on December 31, 2021, when the equity method is applied? b. What is the consolidated net income for the year ending December 31, 2021? c-1. What is the consolidated equipment balance as of December 31, 2021? c-2. Would this answer be affected by the investment method applied by the parent? d. Prepare entry "C for the beginning of the Retained Earnings account on a December 31, 2021 by using initial value, partial equity and equity method. Req A to C2 Req D a. What balance does Haynes's Investment in Turner account show on December 31, 2021, when the equity method is applied? b. What is the consolidated net income for the year ending December 31, 2021? c-1. What is the consolidated equipment balance as of December 31, 2021? c-2. Would this answer be affected by the investment method applied by the parent? Show less A a. Investment in Turner account b. Consolidated net income c-1. Consolidated equipment c-2. Would this answer be affected by the investment method applied by the parent? Consolidation Worksheet Entries < 1 2 3 Prepare entry *C if the parent used the initial value method. Note: Enter debits before credits. Date Accounts December 31, 2021 Debit Credit
Transcribed Image Text:Haynes, Inc., obtained 100 percent of Turner Company's common stock on January 1, 2020, by issuing 11,200 shares of $10 par value common stock. Haynes's shares had a $15 per share fair value. On that date, Turner reported a net book value of $120,200. However, its equipment (with a five-year remaining life) was undervalued by $8,700 in the company's accounting records. Also, Turner had developed a customer list with an assessed value of $39.100, although no value had been recorded on Turner's books. The customer list had an estimated remaining useful life of 10 years. The following balances come from the individual accounting records of these two companies as of December 31, 2020: Haynes Turner $ (638,000) $ (351,000) Revenues Expenses 465,000 191,000 Investment income Not given Dividends declared 90,000 80,000 The following balances come from the individual accounting records of these two companies as of December 31, 2021: Haynes Turner Revenues $ (776,000) $ (407,500) Expenses 486,500 Investment income Dividends declared Not given 110,000 222,900 e 60,000 311,000 Equipment 510,000 a. What balance does Haynes's Investment in Turner account show on December 31, 2021, when the equity method is applied? b. What is the consolidated net income for the year ending December 31, 2021? c-1. What is the consolidated equipment balance as of December 31, 2021? c-2. Would this answer be affected by the investment method applied by the parent? d. Prepare entry "C for the beginning of the Retained Earnings account on a December 31, 2021 by using initial value, partial equity and equity method. Req A to C2 Req D a. What balance does Haynes's Investment in Turner account show on December 31, 2021, when the equity method is applied? b. What is the consolidated net income for the year ending December 31, 2021? c-1. What is the consolidated equipment balance as of December 31, 2021? c-2. Would this answer be affected by the investment method applied by the parent? Show less A a. Investment in Turner account b. Consolidated net income c-1. Consolidated equipment c-2. Would this answer be affected by the investment method applied by the parent? Consolidation Worksheet Entries < 1 2 3 Prepare entry *C if the parent used the initial value method. Note: Enter debits before credits. Date Accounts December 31, 2021 Debit Credit
Consolidation Worksheet Entries < 1 2 3 Prepare entry *C if the parent used the partial equity method. Note: Enter debits before credits. Date Accounts Debit December 31, 2021 Record entry Consolidation Worksheet Entries < 1 2 3 Prepare entry "C if the parent used the equity method. Note: Enter debits before credits. Date Accounts December 31, 2021 Record entry Clear entry Clear entry > Credit view consolidation entries Credit view consolidation entries Debit
Transcribed Image Text:Consolidation Worksheet Entries < 1 2 3 Prepare entry *C if the parent used the partial equity method. Note: Enter debits before credits. Date Accounts Debit December 31, 2021 Record entry Consolidation Worksheet Entries < 1 2 3 Prepare entry "C if the parent used the equity method. Note: Enter debits before credits. Date Accounts December 31, 2021 Record entry Clear entry Clear entry > Credit view consolidation entries Credit view consolidation entries Debit
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