Using the information presented in Problem 7- 10 prepare a consolidated financial statements workpaper for the year

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Using the information presented in Problem 7- 10 prepare a consolidated financial statements workpaper for the year ended December 31, 2025, using the trial balance format.

Data from problem 10

Prout Company owns 80% of the common stock of Sexton Company. The stock was purchased for $1,600,000 on January 1, 2022, when Sexton Company’s retained earnings were $800,000. On January 1, 2024, Prout Company sold fixed assets to Sexton Company for $360,000. These assets were originally purchased by Prout Company for $400,000 on January 1, 2014, at which time their estimated depreciable life was 25 years. The straight- line method of depreciation is used. On December 31, 2025, the trial balances of the two companies were as shown here:

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Advanced Accounting

ISBN: 9781119794653

8th Edition

Authors: Debra C. Jeter, Paul K. Chaney

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