Question

Lane Manufacturing Company acquired 75 percent of Tin Corporation stock at underlying book value. At the date of acquisition, the fair value of the noncontrolling interest was equal to 25 percent of Tin’s book value. The balance sheets of the two companies for January 1, 20X1, are as follows:


On January 2, 20X1, Lane purchased an additional 2,500 shares of common stock directly from Tin for $150,000. Any purchase differential is assigned to buildings and equipment.

Required
a. Prepare the elimination entry needed to complete a consolidated balance sheet worksheet immediately following the issuance of additional shares to Lane.
b. Prepare a consolidated balance sheet worksheet immediately following the issuance of additional shares toLane.


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  • CreatedMay 23, 2014
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