ADVANCED FINANCIAL ACCOUNTING IA
12th Edition
ISBN: 9781260545081
Author: Christensen
Publisher: MCG
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Chapter 4, Problem 4.20E
a.
To determine
Introduction: Consolidated Financial Statements are the financial statements of a group in which the assets, liabilities, equity, income, expenses and cash flow of the parent company and its subsidiaries are presented as those of a single entity.
To prepare: Consolidation entries on December 31, 20X3 to prepare consolidation financial statement.
b.
To determine
Introduction: Consolidation Worksheet is a tool which is used in preparation of consolidated financial statement of parent company and its subsidiary.
To prepare: A three-partConsolidated worksheet.
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b. Prepare all consolidation entries needed to prepare consolidated statements
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required" in the first account field.a. Prepare all journal entries that Pizza recorded
during 20×5 related to its investment in Slice. Note: If no entry is required for a
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transaction listPizza Corporation acquired 80 percent ownership of Slice Products Company
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Pizza Corporation Slice Products Company Debit Credit Debit Credit Cash and Receivables
$ 86,000 $ 67,000 Inventory 277,000…
Cost method consolidation entries (controlling investment in affiliate, fair value differs from book value)
Assume an investee has the following financial statement information for the three years ending December 31, 2019:
(At December 31) 2019 2018 2017
Current assets $285,000 $277,500 $207,000
Tangible fixed assets 662,500 575,000 563,000
Intangible assets 40,000 45,000 50,000
Total assets $987,500 $897,500 $820,000
Current liabilities $120,000 $110,000 $850,000
Noncurrent liabilities 266,250 242,500 220,000
Common stock 100,000 100,000 100,000
Additional paid-in capital 100,000 100,000 100,000
Retained earnings 400,000 345,000 300,000
Stockholders' equity 600,000 545,000 500,000
Total liabilities and equity $986,250 $897,500 $820,000
(For the years ended December 31) 2019 2018 2017
Revenues $970,000 $920,000 $850,000
Expenses 875,000 840,000 775,000
Net income $95,000 $80,000 $75,000
Dividends $40,000 $35,000 $25,000
Assume on January 1, 2017, an investor company purchased 100%…
Consolidation at the end of the first year subsequent to date of acquisition-Cost method (purchase price equals book value)
Assume the parent company acquires its subsidiary on January 1, 2019, by exchanging 20,000 shares of its $1 par value Common Stock, with a market value on the acquisition date of $50 per share, for all of the outstanding voting shares of the acquiree. You have been charged with preparing the consolidation of these two companies at the end of the
first year.
On the acquisition date, all of the subsidiary's assets and liabilities had fair values equaling their book values. The parent uses the cost method of pre-consolidation Equity investment bookkeeping. Following are financial statements of the parent and its subsidiary for the year ended December 31, 2019.
Parent Subsidiary
Parent Subsidiary
Income statement
Sales
Cost of goods sold
Gross profit
Investment income
Operating expenses
Net income
Statement of retained earnings
BOY retained earnings
Net income…
Chapter 4 Solutions
ADVANCED FINANCIAL ACCOUNTING IA
Ch. 4 - When is the carrying value of the investment...Ch. 4 - What is a differential? How is a differential...Ch. 4 - Prob. 4.3QCh. 4 - Prob. 4.4QCh. 4 - Prob. 4.5QCh. 4 - Prob. 4.6QCh. 4 - Prob. 4.7QCh. 4 - Prob. 4.8QCh. 4 - Prob. 4.9QCh. 4 - Prob. 4.10Q
Ch. 4 - Prob. 4.11QCh. 4 - What determines whether the balance assigned to...Ch. 4 - What does the termpushdown accountingmean?Ch. 4 - Under what conditions is push-down accounting...Ch. 4 - Prob. 4.15QCh. 4 - Prob. 4.2CCh. 4 - Prob. 4.3CCh. 4 - Prob. 4.4CCh. 4 - Prob. 4.1ECh. 4 - Prob. 4.2ECh. 4 - Prob. 4.3ECh. 4 - Prob. 4.4ECh. 4 - Prob. 4.5ECh. 4 - Prob. 4.6ECh. 4 - Prob. 4.7ECh. 4 - Prob. 4.8ECh. 4 - Prob. 4.9ECh. 4 - Prob. 4.10.1ECh. 4 - Prob. 4.10.2ECh. 4 - Prob. 4.10.3ECh. 4 - Prob. 4.10.4ECh. 4 - Prob. 4.10.5ECh. 4 - Prob. 4.11.1ECh. 4 - Prob. 4.11.2ECh. 4 - Prob. 4.11.3ECh. 4 - Prob. 4.11.4ECh. 4 - Prob. 4.12ECh. 4 - Prob. 4.13ECh. 4 - Prob. 4.14ECh. 4 - Prob. 4.15ECh. 4 - Prob. 4.16ECh. 4 - Prob. 4.17ECh. 4 - Prob. 4.18.1ECh. 4 - Prob. 4.18.2ECh. 4 - Prob. 4.18.3ECh. 4 - Prob. 4.18.4ECh. 4 - Prob. 4.18.5ECh. 4 - Prob. 4.18.6ECh. 4 - Prob. 4.19ECh. 4 - Prob. 4.20ECh. 4 - Prob. 4.21ECh. 4 - Prob. 4.22ECh. 4 - Prob. 4.23ECh. 4 - Prob. 4.24AECh. 4 - Prob. 4.25PCh. 4 - Prob. 4.26PCh. 4 - Prob. 4.27PCh. 4 - Consolidated Balance Sheet Powder Company spent...Ch. 4 - Prob. 4.29PCh. 4 - Prob. 4.30PCh. 4 - Prob. 4.31PCh. 4 - Prob. 4.32PCh. 4 - Prob. 4.33PCh. 4 - Prob. 4.34PCh. 4 - Prob. 4.35PCh. 4 - Prob. 4.36PCh. 4 - Prob. 4.37AP
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