Question: Please solve this Question REQUIREMENT C: Following are selected accounts for Mergaronite Company and Hill, Inc., as of December 31, 2018. Several of Mergaronite's accounts
Please solve this Question



REQUIREMENT C:

Following are selected accounts for Mergaronite Company and Hill, Inc., as of December 31, 2018. Several of Mergaronite's accounts have been omitted. Credit balances are indicated by parentheses. Dividends were declared and paid in the same period. Mergaronite (580,000) (244,000) 98,000 52,000 Revenues Cost of goods sold Depreciation expense Investment income Retained earnings, 1/1/18 Dividends declared Current assets Land Buildings (net) Equipment (net) Liabilities Common stock Additional paid-in capital 276,000 104,000 NA NA (888,000) 604,000) 136,000 208,000 316,000 482,000 218,000 (384,000) (284,000) 46,000 686,000 92,000 122,000 250,000 (302,000) (40,000) (50,000(908,000) Assume that Mergaronite took over Hill on January 1, 2014, by issuing 7,000 shares of common stock having a par value of $10 per share but a fair value of $100 each. On January 1, 2014, Hill's land was undervalued by $19,800, its buildings were overvalued by $30,800, and equipment was undervalued by $59,400. The buildings had a 10-year remaining life; the equipment had a 5-year remaining life. A customer list with an appraised value of $104,000 was developed internally by Hill and was to be written off over a 20-year period. a. Determine the December 31, 2018, consolidated totals for the following accounts b. In requirement (a), can the consolidated totals be determined without knowing which method the parent used to account for the subsidiary? c. If the parent uses the equity method, what consolidation entries would be used on a 2018 worksheet
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