ADVANCED FINANCIAL ACCOUNTING IA
12th Edition
ISBN: 9781260545081
Author: Christensen
Publisher: MCG
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Chapter 4, Problem 4.22E
a.
To determine
Introduction: Consolidate financial statement are refer as a financial statement in which all the assets, liabilities, income, expense and cash flow of subsidiary and parent company are merged and shown as a single entity.
To prepare: Consolidation entries needed to prepare consolidation worksheet.
b.
To determine
Introduction: Consolidation Worksheet is a tool used to prepare consolidated financial statement of parent company and its subsidiary.
To prepare: Consolidated worksheet.
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On January 1, 20X3, Plimsol Company acquired 100 percent of Shipping Corporation's voting shares, at underlying book value. Plimsol uses the cost method in accounting for its investment in Shipping. Shipping's
reported retained earnings of $75,000 on the date of acquisition. The trial balances for Plimsol Company and Shipping Corporation as of December 31, 20X4, follow:
24
Item
Current Assets
Depreciable Assets (net)
Investment in Shipping Corporation
Other Expenses
Depreciation Expense
Dividends Declared
Current Liabilities
Long-Term Debt
Common Stock
Retained Earnings
Sales
Dividend Income
Plimsol Company
Debit
Credit
$ 160,000
180,000
125,000
85,000
20,000
30,000
Shipping Corporation
Debit
Credit
$ 115,000
135,000
60,000
15,000
15,000
$ 25,000
75,000
100,000
210,000
175,000
15,000
$ 600,000 $ 600,000 $ 340,000 $ 340,000
$ 20,000
50,000
50,000
Required:
1. Provide all consolidating entries required to prepare a full set of consolidated statements for 20X4.
2. Prepare a three-part…
SUBSEQUENT TO DATE OF ACQUISITION
CHAPTER 3: CONSOLIDATION-
21. Patriotism Company purchased 70% of Strength Company on
January 2, 2022 for P420,000. At that date Strength had inventory
and plant assets with market values greater than book values in the
amount of P50,000 and P90,000, respectively. The inventory and
plant assets were assigned to have a remaining life of six months and
five years, respectively. Strength Company has 2022 income and
dividends of P160,000 and P60,000, respectively and 2023 income
and dividends of P210,000 and P80,000, respectively.
The balance of non-controlling interest account on December 31.
180,000
NU beg (420K 787. x30%.)
2023 must be:
a. P223,200
b. P276,000
P169,200
с.
d. P136,800
22. Jenny Company acquired 80% of the equity share capital of Smith
Prophet Corporation acquired 75 percent of Seer Corporation's voting common stock on December 31, 20X4, for $390,000. At the
date of combination, Seer reported the following:
Assets
Current Assets
Long-Term Assets (net)
Total
$ 220,000
420,000
view transaction list
$ 640,000
Consolidation
Worksheet Entries
Liabilities
Current Liabilities.
Long-Term Liabilities.
Common Stock
Retained Earnings
Total
At December 31, 20X4, the book values of Seer's net assets and liabilities approximated their fair values, except for buildings, which
had a fair value of $80,000 more than book value, and inventories, which had a fair value of $36,000 more than book value. The fair
value of the noncontrolling interest was determined to be $130,000 at that date.
$ 80,000
200,000
120,000
240,000
$ 640,000
Required:
Prophet Corporation wishes to prepare a consolidated balance sheet immediately following the business combination. Prepare the
consolidation entry or entries needed to prepare a consolidated balance…
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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