On March 1 2016 Carlson Enterprises purchases a 100 interest
On March 1, 2016, Carlson Enterprises purchases a 100% interest in Entro Corporation for $400,000. Entro Corporation has the following balance sheet on February 28, 2015:
Carlson Enterprises receives an independent appraisal on the fair values of Entro Corporation’s assets and liabilities. The controller has reviewed the following figures and accepts them as reasonable:
Accounts receivable . . . . . . . . . . $ 60,000
Inventory . . . . . . . . . . . . . . . . . . . 100,000
Land. . . . . . . . . . . . . . . . . . . . . . . 40,500
Building. . . . . . . . . . . . . . . . . . . . 202,500
Equipment . . . . . . . . . . . . . . . . . . 162,000
Current liabilities . . . . . . . . . . . . . 50,000
Bonds payable . . . . . . . . . . . . . . 95,000
Rqeuired
1. Record the investment in Entro Corporation.
2. Prepare the value analysis and the determination and distribution of excess schedule.
3. Prepare the elimination entries that would be made on a consolidated worksheet prepared on the date of acquisition.
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