On January 1, 2015 Trump Company spent $240,000 to acquire all Aramco Corporation's outstanding shares by...

  

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On January 1, 2015 Trump Company spent $240,000 to acquire all Aramco Corporation's outstanding shares by paying $100,000 in cash and issuing 10,000 of it's $1 par value common stock that was trading on the NYSE at $14 per share on that same date. The financial statements of the two companies were as follows on December 31, 2017. Income Statement Service Revenue Less: Cost of Services Less: Depreciation Expense Less: Other Expenses Income from Aramco Corp. Net Income Statement of Retained Earnings Beginning Balance Net Income Less: Dividends Declared Ending Balance Balance Sheet Cash Accounts Receivable Land Buildings & Equipment Investment in Aramco Corp. Trump Co. 610,000 (470,000) (35,000) (57,000) 28,000 76,000 292,000 76,000 (30,000) 338,000 74,000 130,000 60,000 235,000 268,000 Aramco Corp. 240,000 (130,000) (18,000) (60,000) 32,000 120,000 32,000 (12,000) 140,000 42,000 53,000 50,000 257,000 Total Assets Accounts Payable Taxes Payable Notes Payable Common Stock Retained Earnings Total Liabilities & Equity 767,000 71,000 58,000 100,000 200,000 338,000 767,000 402,000 17,000 60,000 85,000 100,000 140,000 402,000 Armco Corporation reported retained earnings of $100,000 at the date of acquisition. The difference between the acquisition price and underlying book value is assigned to buildings and equipment with a remaining economic life of 10 years from the date of acquisition. Aramco owed Trump $10,000 as of December 31, 2017. Required. 1. Provide the journal entry recorded by Trump Corporation for its investment in Aramco for 2015. 2. Provide the equity method journal entries recorded by Trump Corporation for its investment in Aramco for 2017 3. Prepare the consolidation entries for 2017 4. Prepare a consolidation worksheet in Excel for December 31, 2017 On January 1, 2015 Trump Company spent $240,000 to acquire all Aramco Corporation's outstanding shares by paying $100,000 in cash and issuing 10,000 of it's $1 par value common stock that was trading on the NYSE at $14 per share on that same date. The financial statements of the two companies were as follows on December 31, 2017. Income Statement Service Revenue Less: Cost of Services Less: Depreciation Expense Less: Other Expenses Income from Aramco Corp. Net Income Statement of Retained Earnings Beginning Balance Net Income Less: Dividends Declared Ending Balance Balance Sheet Cash Accounts Receivable Land Buildings & Equipment Investment in Aramco Corp. Trump Co. 610,000 (470,000) (35,000) (57,000) 28,000 76,000 292,000 76,000 (30,000) 338,000 74,000 130,000 60,000 235,000 268,000 Aramco Corp. 240,000 (130,000) (18,000) (60,000) 32,000 120,000 32,000 (12,000) 140,000 42,000 53,000 50,000 257,000 Total Assets Accounts Payable Taxes Payable Notes Payable Common Stock Retained Earnings Total Liabilities & Equity 767,000 71,000 58,000 100,000 200,000 338,000 767,000 402,000 17,000 60,000 85,000 100,000 140,000 402,000 Armco Corporation reported retained earnings of $100,000 at the date of acquisition. The difference between the acquisition price and underlying book value is assigned to buildings and equipment with a remaining economic life of 10 years from the date of acquisition. Aramco owed Trump $10,000 as of December 31, 2017. Required. 1. Provide the journal entry recorded by Trump Corporation for its investment in Aramco for 2015. 2. Provide the equity method journal entries recorded by Trump Corporation for its investment in Aramco for 2017 3. Prepare the consolidation entries for 2017 4. Prepare a consolidation worksheet in Excel for December 31, 2017

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The question is complete and relates to accounting for consolidation and equity method journal entries Heres how to approach each part of the question 1 Provide the journal entry recorded by Trump Com... View the full answer