On January 1, 2017, QuickPort Company acquired 90 percent of the outstanding voting stock of Net-Speed, Inc.,

Question:

On January 1, 2017, QuickPort Company acquired 90 percent of the outstanding voting stock of Net-Speed, Inc., for $810,000 in cash and stock options. At the acquisition date, Net-Speed had of $800,000 and Retained Earnings of $40,000. The acquisition-date fair value of the 10 percent non-controlling interest was $90,000. QuickPort attributed the $60,000 excess of
Net Speed's fair value over book value to a database with a five-year remaining life.
During the next two years, Net-Speed reported the following:
_____________ Net Income __________ Dividends Declared
2017 ............... $ 80,000 ....................... $8,000
2018 ................ 115,000 ........................ 8,000
On July 1, 2017, QuickPort sold communication equipment to Net-Speed for $42,000. The equipment originally cost $48,000 and had accumulated depreciation of $9,000 and an estimated remaining life of three years at the date of the intra-entity transfer.
a. Compute the equity method balance in QuickPort's Investment in Net-Speed, Inc., account as of December 31, 2018.
b. Prepare the worksheet adjustments for the December 31, 2018, consolidation of QuickPort and Net-Speed?
Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on...