Stake Company reported the following summarized balance sheet data as of December 31, 20X2 $ 32,000...

 

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Stake Company reported the following summarized balance sheet data as of December 31, 20X2 $ 32,000 Accounts Payable Common Stock 81,000 94,000 Retained Earnings 270,000 (130,000) $ 347,000 Total Liabilities and Equities Cash Accounts Receivable Inventory Buildings and Equipment Less: Accumulated Depreciation Total Assets $ 42,000 110,000 195,000 $ 347,000 Stake issues 4,600 additional shares of its $10 par value stock to its shareholders as a stock dividend on April 20, 20X3 The market price of Stake's shares at the time of the stock dividend is $55. Stake reports net income of $28,000 and pays a $10.500 cash dividend in 20X3. Pole Company acquired 70 percent of Stake's common shares at book value on January 1, 20X1. At that date, the fair value of the noncontrolling interest was equal to 30 percent of Stake's book value. Pole uses the equity method in accounting for its investment in Stake Required: a. Prepare the journal entries recorded by Stake and Pole at the time the stock dividend is declared and distributed b. Prepare the worksheet consolidation entries needed to prepare consolidated financial statements for 20X3 c. Prepare the worksheet consolidation entry needed to prepare a consolidated balance sheet on January 1, 20X4 Stake Company reported the following summarized balance sheet data as of December 31, 20X2 $ 32,000 Accounts Payable Common Stock 81,000 94,000 Retained Earnings 270,000 (130,000) $ 347,000 Total Liabilities and Equities Cash Accounts Receivable Inventory Buildings and Equipment Less: Accumulated Depreciation Total Assets $ 42,000 110,000 195,000 $ 347,000 Stake issues 4,600 additional shares of its $10 par value stock to its shareholders as a stock dividend on April 20, 20X3 The market price of Stake's shares at the time of the stock dividend is $55. Stake reports net income of $28,000 and pays a $10.500 cash dividend in 20X3. Pole Company acquired 70 percent of Stake's common shares at book value on January 1, 20X1. At that date, the fair value of the noncontrolling interest was equal to 30 percent of Stake's book value. Pole uses the equity method in accounting for its investment in Stake Required: a. Prepare the journal entries recorded by Stake and Pole at the time the stock dividend is declared and distributed b. Prepare the worksheet consolidation entries needed to prepare consolidated financial statements for 20X3 c. Prepare the worksheet consolidation entry needed to prepare a consolidated balance sheet on January 1, 20X4 Stake Company reported the following summarized balance sheet data as of December 31, 20X2 $ 32,000 Accounts Payable Common Stock 81,000 94,000 Retained Earnings 270,000 (130,000) $ 347,000 Total Liabilities and Equities Cash Accounts Receivable Inventory Buildings and Equipment Less: Accumulated Depreciation Total Assets $ 42,000 110,000 195,000 $ 347,000 Stake issues 4,600 additional shares of its $10 par value stock to its shareholders as a stock dividend on April 20, 20X3 The market price of Stake's shares at the time of the stock dividend is $55. Stake reports net income of $28,000 and pays a $10.500 cash dividend in 20X3. Pole Company acquired 70 percent of Stake's common shares at book value on January 1, 20X1. At that date, the fair value of the noncontrolling interest was equal to 30 percent of Stake's book value. Pole uses the equity method in accounting for its investment in Stake Required: a. Prepare the journal entries recorded by Stake and Pole at the time the stock dividend is declared and distributed b. Prepare the worksheet consolidation entries needed to prepare consolidated financial statements for 20X3 c. Prepare the worksheet consolidation entry needed to prepare a consolidated balance sheet on January 1, 20X4 Stake Company reported the following summarized balance sheet data as of December 31, 20X2 $ 32,000 Accounts Payable Common Stock 81,000 94,000 Retained Earnings 270,000 (130,000) $ 347,000 Total Liabilities and Equities Cash Accounts Receivable Inventory Buildings and Equipment Less: Accumulated Depreciation Total Assets $ 42,000 110,000 195,000 $ 347,000 Stake issues 4,600 additional shares of its $10 par value stock to its shareholders as a stock dividend on April 20, 20X3 The market price of Stake's shares at the time of the stock dividend is $55. Stake reports net income of $28,000 and pays a $10.500 cash dividend in 20X3. Pole Company acquired 70 percent of Stake's common shares at book value on January 1, 20X1. At that date, the fair value of the noncontrolling interest was equal to 30 percent of Stake's book value. Pole uses the equity method in accounting for its investment in Stake Required: a. Prepare the journal entries recorded by Stake and Pole at the time the stock dividend is declared and distributed b. Prepare the worksheet consolidation entries needed to prepare consolidated financial statements for 20X3 c. Prepare the worksheet consolidation entry needed to prepare a consolidated balance sheet on January 1, 20X4

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To address this question properly its important to first understand the steps involved a Stock Dividend Journal Entries 1 Stakes Journal Entries When ... View the full answer