Simple Trial Balance Consolidation Working Paper, First and Second Years On January 1, 2019, Pacnet Communications...

   

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Simple Trial Balance Consolidation Working Paper, First and Second Years On January 1, 2019, Pacnet Communications acquired all of the stock of SecureWorks Inc. at a cost of $40,000,000 in cash. The $34,000,000 excess of acquisition cost over book value was allocated as follows: Excess of Fair Value over Book Value Subsequent reporting Plant assets .... Identifiable intangible assets Goodwill ...... $ (5,000,000) 2,000,000 10-year life, straight-line 5-year life, straight-line Impairment loss 2019, $1,000,000; 2020, $1,500,000 37,000,000 $34,000,000 Both companies have December 31 year-ends. Trial balances of Pacnet and SecureWorks at December 31, 2019 and 2020 appear below. Pacnet uses the complete equity method to report its investment in SecureWorks on its own books. Chapter 4 Consolidated Financial Statements Subsequent to Acquisition Pacnet, December 31 SecureWorks, December 31 2020 Dr (Cr) 2019 Dr (Cr) 2020 Dr (Cr) 2019 Dr (Cr) $ 4,000,000 66,200,000 800,000 43,200,000 $ 3,000,000 58,000,000 1,000,000 42,100,000 $ 3,500,000 45,000,000 $ 2,000,000 42,000,000 Current assets Plant assets, net. Identifiable intangible assets Investment in SecureWorks. Liabilities. . (85,000,000) (5,000,000) (19,100,000) (110,000,000) (1,100,000) 82,000,000 24,000,000 (80,000,000) (5,000,000) (12,000,000) (100,000,000) (2,100,000) 80,000,000 (37,000,000) (1,000,000) (8,000,000) (65,000,000) (35,000,000) (1,000,000) (5,000,000) (60,000,000) Capital stock Retained earnings, beginning. Sales revenue.. Equity in net income of SecureWorks Cost of sales. .. Operating expenses 46,000,000 45,000,000 15,000,000 16,500,000 12,000,000 Total . $ 2$ Required Prepare a working paper to consolidate the trial balances of Pacnet and SecureWorks at December 31, 2019, and prepare a consolidated balance sheet at December 31, 2019 and a consolidated income а. statement for 2019. b. Repeat the requirements of a. for the year 2020. Simple Trial Balance Consolidation Working Paper, First and Second Years On January 1, 2019, Pacnet Communications acquired all of the stock of SecureWorks Inc. at a cost of $40,000,000 in cash. The $34,000,000 excess of acquisition cost over book value was allocated as follows: Excess of Fair Value over Book Value Subsequent reporting Plant assets .... Identifiable intangible assets Goodwill ...... $ (5,000,000) 2,000,000 10-year life, straight-line 5-year life, straight-line Impairment loss 2019, $1,000,000; 2020, $1,500,000 37,000,000 $34,000,000 Both companies have December 31 year-ends. Trial balances of Pacnet and SecureWorks at December 31, 2019 and 2020 appear below. Pacnet uses the complete equity method to report its investment in SecureWorks on its own books. Chapter 4 Consolidated Financial Statements Subsequent to Acquisition Pacnet, December 31 SecureWorks, December 31 2020 Dr (Cr) 2019 Dr (Cr) 2020 Dr (Cr) 2019 Dr (Cr) $ 4,000,000 66,200,000 800,000 43,200,000 $ 3,000,000 58,000,000 1,000,000 42,100,000 $ 3,500,000 45,000,000 $ 2,000,000 42,000,000 Current assets Plant assets, net. Identifiable intangible assets Investment in SecureWorks. Liabilities. . (85,000,000) (5,000,000) (19,100,000) (110,000,000) (1,100,000) 82,000,000 24,000,000 (80,000,000) (5,000,000) (12,000,000) (100,000,000) (2,100,000) 80,000,000 (37,000,000) (1,000,000) (8,000,000) (65,000,000) (35,000,000) (1,000,000) (5,000,000) (60,000,000) Capital stock Retained earnings, beginning. Sales revenue.. Equity in net income of SecureWorks Cost of sales. .. Operating expenses 46,000,000 45,000,000 15,000,000 16,500,000 12,000,000 Total . $ 2$ Required Prepare a working paper to consolidate the trial balances of Pacnet and SecureWorks at December 31, 2019, and prepare a consolidated balance sheet at December 31, 2019 and a consolidated income а. statement for 2019. b. Repeat the requirements of a. for the year 2020.

Answer rating: 100% (QA)

2019 Adjustment Balancesheet Pacent Secureworks Dr Cr Consolidated Current Assets 3000000 2000000 5000000 Plant assetsnet 58000000 42000000 500000 5000000 95500000 Identifiable intangible assets 10000... View the full answer