Peanut Company acquired 90 percent of Snoopy Company’s outstanding common stock for $270,000 on January 1, 20X8, when the book value of Snoopy’s net assets was equal to $300,000. Problem 3–27 summarizes the first year of Peanut’s ownership of Snoopy. Peanut uses the equity method to account for investments.

The following trial balance summarizes the financial position and operations for Peanut and Snoopy as of December 31, 20X9:

R e q u i r e d

a. Prepare any equity-method journal entry(ies) related to the investment in Snoopy Company during 20X9.

b. Prepare a consolidation worksheet for 20X9 in good form.

Data From Problem 3-27:

Peanut Company acquired 90 percent of Snoopy Company’s outstanding common stock for $270,000 on January 1, 20X8, when the book value of Snoopy’s net assets was equal to $300,000. Peanut uses the equity method to account for investments. Trial balance data for Peanut and Snoopy as of December 31, 20X8, follow:

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Peanut Company Debit Credit Cash $ 255,000 Snoopy Company Debit $ 75,000 Credit Accounts Receivable 190,000 Inventory 180,000 80,000 100,000 Investment in Snoopy Company 364,500 0 Land 200.000 100,000 Buildings & Equipment Cost of Goods Sold Depreciation Expense S&A Expense 700,000 200,000 270,000 150,000 50,000 10,000 230.000 50,000 Dividends Declared 225.000 30,000 Accumulated Depreciation Accounts Payable Bonds Payable $ 500,000 $ 30,000 75,000 35,000 150,000 85,000 Common Stock 500.000 200,000 Sales Retained Earnings Income from Snoopy Company 517.500 155,000 850.000 300,000 72,000 Total $2,664.500 $2,664,500 $805,000 $805,000