Problem $5-33($Algo$)$ Consolidation Worksheet at End of First Year of Ownership LO $5-2$

Pie Corporation acquired $75$ percent of Slice Company$$s ownership on January $1,20$X$8,$ for $$90,000.$ At that date, the fair value of the noncontrolling interest was $$30,000.$ The book value of Slice$$s net assets at acquisition was $$85,000.$ The book values and fair values of Slice$$s assets and liabilities were equal, except for Slice$$s buildings and equipment, which were worth $$17,000$ more than book value. Accumulated depreciation on the buildings and equipment was $$30,000$ on the acquisition date. Buildings and equipment are depreciated on a $10-$year basis.

Although goodwill is not amortized, the management of Pie concluded at December $31,20$X$8,$ that goodwill from its purchase of Slice shares had been impaired and the correct carrying amount was $$3,000.$ Goodwill and goodwill impairment were assigned proportionately to the controlling and noncontrolling shareholders.

Trial balance data for Pie and Slice on December $31,20$X$8,$ are as follows:

ItemPie CorporationSlice CompanyDebitCreditDebitCreditCash$ $48,500$$ $25,000$Accounts Receivable$82,00016,000$Inventory$102,00029,000$Land$33,00019,000$Buildings and Equipment$357,000169,000$Investment in Slice Company$99,975$Cost of Goods Sold$116,000101,000$Wage Expense$38,00022,000$Depreciation Expense$20,00010,000$Interest Expense$7,0004,000$Other Expenses$8,5005,000$Dividends Declared$39,00015,000$Accumulated Depreciation$$$ $127,000$$ $40,000$Accounts Payable$33,00014,000$Wages Payable$15,00010,000$Notes Payable$195,75079,000$Common Stock$194,00060,000$Retained Earnings$96,00025,000$Sales$269,000187,000$Income from Slice Company$21,225$$ $950,975$$ $950,975$$ $415,000$$ $415,000$Record all consolidation entries needed to prepare a three$-$part consolidation worksheet as of December $31,20$X$8.($a$)$record the basic consolidation entry $($b$)$ record the amortized excess value reclassification entry $($c$)$ record the excess value $($differential$)$ reclassification entry $($d$)$ record the optional accumulated depreciation consolidation entry Prepare a three$-$part consolidation worksheet for $20$X$8.$