Plant Company acquired 100% of the common stock of Shoot Company on January 1, year one,...

  

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Plant Company acquired 100% of the common stock of Shoot Company on January 1, year one, for $600,000 On that date, Shoot had the following trial balance: асcount debit credit Additional paid in capital Building (10-year life) Common stock $100,000 $250,000 170,000 Current assets Equipment (6-yr life) Land 180,000 160,000 110,000 Liabilities (due in 4 years) Retained earnings 1/year 1 310,000 120,000 Totals $700,000 $700,000 During year one, Shoot reported net income of During year one, Shoot paid dividends of $50,000 $30,000 During year two, Shoot reported net income of During year two, Shoot paid dividends of $80,000 $40,000 On January 1, year one, fair values were: Land Building Equipment $122,000 $265,000 $196,000 There was no impairment of any goodwill arising from the acquisition. Please indicate clearly which method you choose for Plant to use to account for its acquisition of Shoot Company. Problem 4. Use the data for the Plant Company acquisition of the Shoot Company to prepare the consolidation worksheet entries for December 31 of year one. Problem 5. Use the data for the Plant Company acquisition of the Shoot Company to prepare the consolidation worksheet entries for December 31 of year two. Plant Company acquired 100% of the common stock of Shoot Company on January 1, year one, for $600,000 On that date, Shoot had the following trial balance: асcount debit credit Additional paid in capital Building (10-year life) Common stock $100,000 $250,000 170,000 Current assets Equipment (6-yr life) Land 180,000 160,000 110,000 Liabilities (due in 4 years) Retained earnings 1/year 1 310,000 120,000 Totals $700,000 $700,000 During year one, Shoot reported net income of During year one, Shoot paid dividends of $50,000 $30,000 During year two, Shoot reported net income of During year two, Shoot paid dividends of $80,000 $40,000 On January 1, year one, fair values were: Land Building Equipment $122,000 $265,000 $196,000 There was no impairment of any goodwill arising from the acquisition. Please indicate clearly which method you choose for Plant to use to account for its acquisition of Shoot Company. Problem 4. Use the data for the Plant Company acquisition of the Shoot Company to prepare the consolidation worksheet entries for December 31 of year one. Problem 5. Use the data for the Plant Company acquisition of the Shoot Company to prepare the consolidation worksheet entries for December 31 of year two.

Answer rating: 100% (QA)

PAGE No DATE Problem 4 Qnd 5 Purchase Cousideiation 600 000 Trial Balance De... View the full answer