Jackson Corporation purchased shares of Phillips Corporation in the following sequence:

The book value of Phillips’ net assets at January 1, 20X6, was $200,000. Each year since Jackson first purchased shares, Phillips has reported net income of $70,000 and paid dividends of $20,000. The amount paid in excess of the book value of Phillips’ net assets was attributed to the increase in the value of identifiable intangible assets with a remaining life of five years at the date the shares of Phillips were purchased. Phillips has had 10,000 shares of voting common stock outstanding throughout the four-year period.

Give the journal entries recorded on Jackson Corporation’s books in 20X9 related to its investment in PhillipsCorporation.

  • CreatedMay 23, 2014
  • Files Included
Post your question