On 15 April 2021, Pike Ltd acquired all the shares in Salmon Ltd. At the date...
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On 15 April 2021, Pike Ltd acquired all the shares in Salmon Ltd. At the date of acquisition, all the identifiable net assets of Salmon Ltd were at fair value except for inventory which was recorded by the subsidiary at $65,000. The fair value of the inventory was $93,000 at the date of acquisition. The inventory was sold on 30 November 2021 for $86,000. The consolidation entry required at 30 June 2021 is: Dr Inventory $28,000; Cr FVA $19,600; Cr DTL $8,400 Dr Retained earnings $19,600; Cr FVA $19,600 No consolidation entries are required Dr COGS $28,000; Cr FVA $19,600; Cr DTL $8,400 On 15 April 2021, Pike Ltd acquired all the shares in Salmon Ltd. At the date of acquisition, all the identifiable net assets of Salmon Ltd were at fair value except for inventory which was recorded by the subsidiary at $65,000. The fair value of the inventory was $93,000 at the date of acquisition. The inventory was sold on 30 November 2021 for $86,000. The consolidation entry required at 30 June 2021 is: Dr Inventory $28,000; Cr FVA $19,600; Cr DTL $8,400 Dr Retained earnings $19,600; Cr FVA $19,600 No consolidation entries are required Dr COGS $28,000; Cr FVA $19,600; Cr DTL $8,400
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Related Book For
Advanced Financial Accounting
ISBN: 978-0137030385
6th edition
Authors: Thomas Beechy, Umashanker Trivedi, Kenneth MacAulay
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