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Peanut Company acquired 90 percent of Snoopy Company's outstanding common stock for $270,000 on January 1, 20X8, when the book value of Snoopy's net assets was equal to $300,000. Peanut uses the equity method to account for investments. Trial balance data for Peanut and Snoopy as of December 31, 20X8, follow: Peanut Company Cash Accounts Receivable Inventory Investment in Snoopy Company 200 Land But 1 Buildings and Equipment 200 Cost of Goods Sold Depreciation Expense Depr Selling & Administrative Expense Dividends Declared Accumulated Depreciation Accounts Payable Bonds Payable Common Stock Retained Earnings Sales Income from Snoopy Company Total Debit $ 158,000 165,000 200,000 319,500 200,000 700,000 200,000 50,000 225,000 100,000 $2,317,500 Credit 450,000 75,000 200,000 500,000 225,000 800,000 67,500 $2,317,500 Snoopy Company Debit $ 80,000 65,000 75,000 200 100,000 200,000 125,000 10,000 40,000 20,000 $715,000 Credit 20,000 60,000 85,000 200,000 100,000 250,000 0 $715,000

Peanut Company acquired 90 percent of Snoopy Company's outstanding common stock for $270,000 on January 1, 20X8, when the book value of Snoopy's net assets was equal to $300,000. Peanut uses the equity method to account for investments. Trial balance data for Peanut and Snoopy as of December 31, 20X8, follow: Peanut Company Cash Accounts Receivable Inventory Investment in Snoopy Company 200 Land But 1 Buildings and Equipment 200 Cost of Goods Sold Depreciation Expense Depr Selling & Administrative Expense Dividends Declared Accumulated Depreciation Accounts Payable Bonds Payable Common Stock Retained Earnings Sales Income from Snoopy Company Total Debit $ 158,000 165,000 200,000 319,500 200,000 700,000 200,000 50,000 225,000 100,000 $2,317,500 Credit 450,000 75,000 200,000 500,000 225,000 800,000 67,500 $2,317,500 Snoopy Company Debit $ 80,000 65,000 75,000 200 100,000 200,000 125,000 10,000 40,000 20,000 $715,000 Credit 20,000 60,000 85,000 200,000 100,000 250,000 0 $715,000

Cornerstones of Financial Accounting
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
ChapterA2: Investments
Section: Chapter Questions
Problem 25E
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Income Statement Sales Less: COGS Less: Depreciation expense Less: Selling & Administrative Expense Income from Snoopy Co. Consolidated net income NCI in net income Controlling Interest in Net Income Statement of Retained Earnings Beginning balance Net income Less: Dividends declared Ending Balance Balance Sheet Assets Cash Accounts receivable Inventory Investment in Snoopy Co. PEANUT COMPANY AND SUBSIDIARY Consolidated Financial Statement Worksheet December 31, 20X8 Land Buildings and equipment Accumulated depreciation Total Assets Liabilities & Stockholders' Equity Accounts payable Bonds payable Common stock Retained earnings NCI in NA of Snoopy Co. Total Liabilities & Stockholders' Equity Peanut Co. $ S $ $ 0 Snoopy Co. 0 S 0 S 0 $ 0 $ 0 0 S 0 S 0 $ Consolidation Entries CR 0 S DR 0 0 S 0 S 0 S S 0 Consolidated 0 $ 0 $ 0 $ 0 0 0 0 0 0
Transcribed Image Text:Income Statement Sales Less: COGS Less: Depreciation expense Less: Selling & Administrative Expense Income from Snoopy Co. Consolidated net income NCI in net income Controlling Interest in Net Income Statement of Retained Earnings Beginning balance Net income Less: Dividends declared Ending Balance Balance Sheet Assets Cash Accounts receivable Inventory Investment in Snoopy Co. PEANUT COMPANY AND SUBSIDIARY Consolidated Financial Statement Worksheet December 31, 20X8 Land Buildings and equipment Accumulated depreciation Total Assets Liabilities & Stockholders' Equity Accounts payable Bonds payable Common stock Retained earnings NCI in NA of Snoopy Co. Total Liabilities & Stockholders' Equity Peanut Co. $ S $ $ 0 Snoopy Co. 0 S 0 S 0 $ 0 $ 0 0 S 0 S 0 $ Consolidation Entries CR 0 S DR 0 0 S 0 S 0 S S 0 Consolidated 0 $ 0 $ 0 $ 0 0 0 0 0 0
Peanut Company acquired 90 percent of Snoopy Company's outstanding common stock for $270,000 on January 1, 20X8, when the book value of Snoopy's net assets was equal to $300,000. Peanut uses the equity method to account for investments. Trial balance data for Peanut and Snoopy as of December 31, 20X8, follow: Cash Accounts Receivable Inventory Investment in Snoopy Company Land Lang Buildings and Equipment Cost of Goods Sold Depreciation Expense Selling & Administrative Expense Dividends Declared Accumulated Depreciation Accounts Payable Bonds Payable Common Stock Retained Earnings Sales Income from Snoopy Company Total Show Transcribed Text View transaction list Peanut Company Debit $ 158,000 165,000 200,000 319,500 200,000 700,000 200,000 50,000 225,000 100,000 $2,317,500 Record the initial investment in Snoopy Co. Credit 450,000 75,000 200,000 500,000 225,000 800,000 67,500 $2,317,500 2 Record Peanut Co.'s 90% share of Snoopy Co.'s 20X8 income. 3 Record Peanut Co.'s 90% share of Snoopy Co.'s 20X8 dividend. Snoopy Company Debit Credit $ 80,000 65,000 75,000 e 100,000 200,000 125,000 10,000 40,000 20,000 $715,000 X CI 20,000 60,000 85,000 200,000 100,000 250,000 $715,000
Transcribed Image Text:Peanut Company acquired 90 percent of Snoopy Company's outstanding common stock for $270,000 on January 1, 20X8, when the book value of Snoopy's net assets was equal to $300,000. Peanut uses the equity method to account for investments. Trial balance data for Peanut and Snoopy as of December 31, 20X8, follow: Cash Accounts Receivable Inventory Investment in Snoopy Company Land Lang Buildings and Equipment Cost of Goods Sold Depreciation Expense Selling & Administrative Expense Dividends Declared Accumulated Depreciation Accounts Payable Bonds Payable Common Stock Retained Earnings Sales Income from Snoopy Company Total Show Transcribed Text View transaction list Peanut Company Debit $ 158,000 165,000 200,000 319,500 200,000 700,000 200,000 50,000 225,000 100,000 $2,317,500 Record the initial investment in Snoopy Co. Credit 450,000 75,000 200,000 500,000 225,000 800,000 67,500 $2,317,500 2 Record Peanut Co.'s 90% share of Snoopy Co.'s 20X8 income. 3 Record Peanut Co.'s 90% share of Snoopy Co.'s 20X8 dividend. Snoopy Company Debit Credit $ 80,000 65,000 75,000 e 100,000 200,000 125,000 10,000 40,000 20,000 $715,000 X CI 20,000 60,000 85,000 200,000 100,000 250,000 $715,000
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