Unit 2 Assignment 5 - practice consolidated

Prepare transactions according to the Generally Accepted Accounting Principles.

Account for various transactions using industry-standard accounting software.

This assignment will give you experience with complex accounting transactions. In this assignment you will prepare a consolidated balance sheet for a company owning 100% of a subsidiary.

Consolidated Balance Sheet Prepare a Consolidated Balance Sheet for Big Lake Bakeries which owns 100% of Marble Falls Orchards. The fair value of Marble Falls net fixed assets are $2,675,000. Big Lake aquired 100% of Marble Falls for Fair value of fixed assets 3,750,000 2,675,000 Balance Sheet prior to acquistion Big Lake Marble Falls Current assets fixed assets, net Liabilties Common Stock Paid in Capital Retained Earnings 4,250,000 4,500,000 350,000 7,500,000 500,000 400,000 500,000 1,675,000 125,000 1,525,000 525,000 1. Determine the Fair Value of Marble Falls' net assets. Account Fair Value Fair Vaue of assets 2. Calculate Goodwill Purchase Price Fair value of assets Goodwill 2. Prepared journal entries on Big Lake's Books Worksheet Initial purchase less equity balances difference less goodwill Step up in Net assets a. Prepare purchase entry Debit Credit b. Prepare consolidated journal entry to consolidate equity accounts c. Prepare consolidated journal entry to consolidate assets 3.Prepare Consolidated balance Sheet Big Lake Marble Falls Debit Credit Consolidated balances Current assets Fixed Assets Investment in Marble Falls Good will Total Liabilites Common Stock Paid in Capital Retained Earnings Total