Question

Highbeam Corporation paid $319,500 to acquire 90 percent ownership of Copper Company on April 1, 20X2. At that date, the fair value of the noncontrolling interest was $35,500. On January 1, 20X2, Copper reported these stockholders’ equity balances:
Common Stock .......... $160,000
Additional Paid-In Capital....... 40,000
Retained Earnings.......... 150,000
Total Stockholders’ Equity....... $350,000
Copper’s operating results and dividend payments for 20X2 were as follows:


Highbeam uses the equity method in recording its investment in Copper.

Required
a. Prepare the journal entries that Highbeam recorded in 20X2 for its investment in Copper.
b. Give the worksheet elimination entries needed at December 31, 20X2, to prepare consolidated financialstatements.


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  • CreatedMay 23, 2014
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