Kim Corporation acquired 100 percent of Normal Company’s outstanding shares on January 1, 20X7. Balance sheet data for the two companies immediately after the purchase follow:

As indicated in the parent company balance sheet, Kim purchased $50,000 of Normal's bonds from the subsidiary immediately after it acquired the stock. An analysis of intercompany receivables and payables also indicates that the subsidiary owes the parent $10,000. On the date of combination, the book values and fair values of Normal's assets and liabilities were the same.

a. Give all elimination entries needed to prepare a consolidated balance sheet for January 1, 20X7.
b. Complete a consolidated balance sheet worksheet.
c. Prepare a consolidated balance sheet in goodform.

  • CreatedMay 23, 2014
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