Problem $4($recommended: Review slides $59-72)$

Hoyle, Schaefer and Doupnik $-$ Chapter $3$ Problem $21$

Chapman Company obtains $100\%$ of Abernethy Company's stock on January $1,2023.$ As of that

date, Abernethy has the following trial balance:

During $2023,$ Abernethy reported net income of $$80,000$ while paying dividends of $$10,000.$

During $2024,$ Abernethy reported income of $$110,000$ while paying dividends of $$30,000.$

Requirement:

Assume that Chapman Company acquired Abernethy's common stock for $$520,000$ in cash. All

of Abernethy's accounts are estimated to have fair value approximately equal to present

book values. Chapman uses the partial equity method for this investment. Prepare consolidation

worksheet entries for December $31,2023.$

$***$Need to show work$***$