Peter Corporation paid $150,000 on January 1, 2020 for a 35% interest in Sand Inc. On...

 

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Peter Corporation paid $150,000 on January 1, 2020 for a 35% interest in Sand Inc. On January 1, 2020, the book value of Sand's stockholders' equity consisted of $200,000 of common stock and $200,000 of retained earnings. All the excess purchase cost over book value acquired was attributable to 50% a equipment (undervalue) with an estimated life of 5 years and 50% for goodwill. Peter Corporation used the equity method. Information of dividends and net income for 2020 of Sand Inc. it is presented below. September 30, 2020-dividends December 31, 2020-net income $15,000 $65,000 Using the working paper. 1. Present the analysis of combination and prepare the journal entries for acquired investment, received dividends, received net income and amortization undervalue of equipment. 2. Calculate the Peter's income from Sand Inc. for 2020. 3. Determine the balance of Peter's Investment in Sandlin account on December 31, 2020. 4. Assume that Peter's net income for 2020 consists of $500,000 sales and expenses of $323,000 and its investment income from Sand Inc. Complete the Income Statement for Peter Corporation for 2020. Peter Corporation paid $150,000 on January 1, 2020 for a 35% interest in Sand Inc. On January 1, 2020, the book value of Sand's stockholders' equity consisted of $200,000 of common stock and $200,000 of retained earnings. All the excess purchase cost over book value acquired was attributable to 50% a equipment (undervalue) with an estimated life of 5 years and 50% for goodwill. Peter Corporation used the equity method. Information of dividends and net income for 2020 of Sand Inc. it is presented below. September 30, 2020-dividends December 31, 2020-net income $15,000 $65,000 Using the working paper. 1. Present the analysis of combination and prepare the journal entries for acquired investment, received dividends, received net income and amortization undervalue of equipment. 2. Calculate the Peter's income from Sand Inc. for 2020. 3. Determine the balance of Peter's Investment in Sandlin account on December 31, 2020. 4. Assume that Peter's net income for 2020 consists of $500,000 sales and expenses of $323,000 and its investment income from Sand Inc. Complete the Income Statement for Peter Corporation for 2020.

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1 Present the analysis of the combination and prepare the journal entries Analysis of the Combinatio... View the full answer