Post Delivery Service acquired at book value 80 percent of the voting shares of Script Real...
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Post Delivery Service acquired at book value 80 percent of the voting shares of Script Real Estate Company. On that date, the fair value of the noncontrolling interest was equal to 20 percent of Script's book value. Script Real Estate reported common stock of $340,000 and retained earnings of $115,000. During 20X3, Post Delivery provided courier services for Script Real Estate in the amount of $17,000. Also during 20X3, Script Real Estate purchased land for $2,000. It sold the land to Post Delivery Service for $29,000 so that Post Delivery could build a new transportation center. Post Delivery reported $53,000 of operating income from its delivery operations in 20X3. Script Real Estate reported net income of $53,000 and paid dividends of $12,000 in 20X3. Required: a. Compute consolidated net income for 20X3. Consolidated net income b. Prepare all journal entries recorded by Post Delivery Service related to its investment in Script Real Estate assuming Post uses the fully adjusted equity method in accounting for the investment. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet A B Record the dividends from Script Real Estate. > c. Prepare all consolidation entries required in preparing a consolidation worksheet as of December 31, 20X3. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) view transaction list Consolidation Worksheet Entries A Event 1 B Record the basic consolidation entry. C Note: Enter debits before credits. Record entry Accounts Clear entry Debit Credit view consolidation entries > Post Delivery Service acquired at book value 80 percent of the voting shares of Script Real Estate Company. On that date, the fair value of the noncontrolling interest was equal to 20 percent of Script's book value. Script Real Estate reported common stock of $340,000 and retained earnings of $115,000. During 20X3, Post Delivery provided courier services for Script Real Estate in the amount of $17,000. Also during 20X3, Script Real Estate purchased land for $2,000. It sold the land to Post Delivery Service for $29,000 so that Post Delivery could build a new transportation center. Post Delivery reported $53,000 of operating income from its delivery operations in 20X3. Script Real Estate reported net income of $53,000 and paid dividends of $12,000 in 20X3. Required: a. Compute consolidated net income for 20X3. Consolidated net income b. Prepare all journal entries recorded by Post Delivery Service related to its investment in Script Real Estate assuming Post uses the fully adjusted equity method in accounting for the investment. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet A B Record the dividends from Script Real Estate. > c. Prepare all consolidation entries required in preparing a consolidation worksheet as of December 31, 20X3. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) view transaction list Consolidation Worksheet Entries A Event 1 B Record the basic consolidation entry. C Note: Enter debits before credits. Record entry Accounts Clear entry Debit Credit view consolidation entries >
Expert Answer:
Answer rating: 100% (QA)
a Compute consolidated net income for 2013 as follows Operating income reported by P Net income repo... View the full answer
Related Book For
Advanced Financial Accounting
ISBN: 978-0078025624
10th edition
Authors: Theodore E. Christensen, David M. Cottrell, Richard E. Baker
Posted Date:
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