Plug Products owns 80 percent of the stock of Spark Filter Company, which it acquired at underlying book value on August 30, 20X6. At that date, the fair value of the noncontrolling interest was equal to 20 percent of the book value of Spark Filter. Summarized trial balance data for the two companies as of December 31, 20X8, are as follows: Plug Products Cash and Accounts Receivable Inventory Buildings and Equipment (net) Investment in Spark Filter Company Cost of Goods Sold Depreciation Expense Current Liabilities Common Stock Retained Earnings Sales Income from Spark Filter Company Total Credit $ 156,000 236,000 281,000 263,098 169,000 35,000 $ 1,140,098 Debit $ 183,068 184,000 468,000 259,532 45,498 $ 1,140,098 Spark Filter Company Credit Debit $ 105,000 119,000 186,000 134,000 25,000 $ 569,000 $ 67,468 83,000 209,000 209,532 $ 569,000 On January 1, 20X8, Plug's inventory contained filters purchased for $67,000 from Spark Filter, which had produced the filters for $47,000. In 20X8, Spark Filter spent $107,000 to produce additional filters, which it sold to Plug for $152,532. By December 31, 20X8, Plug had sold all filters that had been on hand January 1, 20X8, but continued to hold in inventory $45,760 of the 20X8 purchase from Spark Filter. Required: a. Prepare all consolidation entries needed to complete a consolidation worksheet for 20X8. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
Plug Products owns 80 percent of the stock of Spark Filter Company, which it acquired at underlying book value on August 30, 20X6. At that date, the fair value of the noncontrolling interest was equal to 20 percent of the book value of Spark Filter. Summarized trial balance data for the two companies as of December 31, 20X8, are as follows: Plug Products Cash and Accounts Receivable Inventory Buildings and Equipment (net) Investment in Spark Filter Company Cost of Goods Sold Depreciation Expense Current Liabilities Common Stock Retained Earnings Sales Income from Spark Filter Company Total Credit $ 156,000 236,000 281,000 263,098 169,000 35,000 $ 1,140,098 Debit $ 183,068 184,000 468,000 259,532 45,498 $ 1,140,098 Spark Filter Company Credit Debit $ 105,000 119,000 186,000 134,000 25,000 $ 569,000 $ 67,468 83,000 209,000 209,532 $ 569,000 On January 1, 20X8, Plug's inventory contained filters purchased for $67,000 from Spark Filter, which had produced the filters for $47,000. In 20X8, Spark Filter spent $107,000 to produce additional filters, which it sold to Plug for $152,532. By December 31, 20X8, Plug had sold all filters that had been on hand January 1, 20X8, but continued to hold in inventory $45,760 of the 20X8 purchase from Spark Filter. Required: a. Prepare all consolidation entries needed to complete a consolidation worksheet for 20X8. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
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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Transcribed Image Text:Plug Products owns 80 percent of the stock of Spark Filter Company, which it acquired at underlying book value on August 30, 20X6.
At that date, the fair value of the noncontrolling interest was equal to 20 percent of the book value of Spark Filter. Summarized trial
balance data for the two companies as of December 31, 20X8, are as follows:
Plug Products
Cash and Accounts Receivable
Inventory
Buildings and Equipment (net)
Investment in Spark Filter Company
Cost of Goods Sold
Depreciation Expense
Current Liabilities
Common Stock
Retained Earnings
Sales.
Income from Spark Filter Company
Total
Credit
$ 156,000
236,000
view transaction list
281,000
263,098
Consolidation
Worksheet Entries
169,000
35,000
$ 1,140,098
Debit
$ 183,068
184,000
468,000
259,532
45,498
$ 1,140,098
Spark Filter Company
Credit
Debit
$ 105,000
119,000
186,000
134,000
25,000
$ 569,000
On January 1, 20X8, Plug's inventory contained filters purchased for $67,000 from Spark Filter, which had produced the filters for
$47,000. In 20X8, Spark Filter spent $107,000 to produce additional filters, which it sold to Plug for $152,532. By December 31, 20X8,
Plug had sold all filters that had been on hand January 1, 20X8, but continued to hold in inventory $45,760 of the 20X8 purchase from
Spark Filter.
$ 67,468
83,000
209,000
209,532
$ 569,000
Required:
a. Prepare all consolidation entries needed to complete a consolidation worksheet for 20x8.
Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
Transcribed Image Text:Record entry
Clear entry
b. Compute consolidated net income and income assigned to the controlling interest in the 20X8 consolidated income statement.
Consolidated net income
Income assigned to the controlling interest
view consolidation entries
Noncontrolling interest
c. Compute the balance assigned to the noncontrolling interest in the consolidated balance sheet as of December 31, 20X8.
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