Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Price Corporation acquired 100 percent ownership of Saver Company on January 1, 20x8, for $223,000. At that date, the fair value of Saver's buildings
Price Corporation acquired 100 percent ownership of Saver Company on January 1, 20x8, for $223,000. At that date, the fair value of Saver's buildings and equipment was $58.000 more than the book value. Buildings and equipment are depreciated on a 10-year basis. Although goodwill is not amortized. Price's management concluded at December 31, 20x8. that goodwill involved in its acquisition of Saver shares had been impaired and the correct carrying value was $12,000. Trial balance data for Price and Saver on December 31, 20X8. are as follows: Price Corporation Debit Credit Item Cash Accounts Receivable Inventory Land Buildings & Equipment Investment in Saver Company Cost of Goods Sold Wage Expense Depreciation Expense Interest Expense Other Expenses Dividends Declared Accumulated Depreciation Accounts Payable Wages Payable Notes Payable Common Stock Retained Earnings Sales Income from Saver Company $ 29,000 89,000 109,000 49,000 303,000 206,708 144,000 117,500 34,500 21, 500 31,508 49,000 $ 154,500 120,000 36,000 169,000 219,000 121,000 355,000 9,200 $1,183,700 $1,183,700 $ Saver Company Debit 40,000 21,500 44,000 34,000 177,500 129,000 36,500 19,500 13,500 52,500 25,500 $593,500 Credit $135,000 19,000 18,500 2,000 60,000 49,000 319,000 $593,500 Required: a. Prepare the consolidating entries needed to prepare a three-part consolidation worksheet as of December 31, 20X8. (If no entry is required for a transaction/event, select "No journal entry required" In the first account field.)
Step by Step Solution
★★★★★
3.42 Rating (158 Votes )
There are 3 Steps involved in it
Step: 1
The consolidating entries are as follows Scenario Fair Value Adjustment on Buildings and Equipmen...Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started