Chapman Company obtains 100 percent of Abernethy Company's stock on January 1, 2023. As of that date, Abernethy has thefollowing trial balance:ItemsAccounts payableAccounts receivableDebitCredit$ 53,700$ 41,000Additional paid-in capitalBuildings (net) (4-year remaining life)50,000184,000Cash and short-term investments77,250Common stock250,000Equipment (net) (5-year remaining life)Inventory400,000117,500LandLong-term liabilities (mature 12/31/26)Retained earnings, 1/1/23SuppliesTotals107,500173,000417,45016,900$ 944,150 $ 944,150During 2023, Abernethy reported net income of $98,000 while declaring and paying dividends of $12,000. During 2024, Abernreported net income of $128,250 while declaring and paying dividends of $39,000.Assume that Chapman Company acquired Abernethy's common stock by paying $890,450 in cash. All of Abernethy's accountsestimated to have a fair value approximately equal to present book values. Chapman uses the partial equity method to accountInvestment.Required:Prepare the consolidation worksheet entries for December 31, 2023, and December 31, 2024.Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.NoDate1December 31, 2023 Common stock-AbernethyAdditional paid-in capital-Abernethy2Retained earningsInvestment in AbernethyAnswer is not complete.AccountsDebitCredit× × × ×3000250,00050,000417,450717,45070,40068,25021,500December 31, 2023 Equity in subsidiary earningsBuildingsGoodwillEquipment

Consolidation:Consolidation means combining the financial items of subsidiary company with the…

Accounts payable Accounts receivable Items Additional paid-in capital Buildings (net) (4-year remaining life) Cash and short-term investments Debit $ 41,000 Credit $ 53,700 50,000 184,000 77,250 Common stock 250,000 Equipment (net) (5-year remaining life) Inventory 400,000 117,500 Land Long-term Liabilities (mature 12/31/26) 107,500 Retained earnings, 1/1/23 173,000 417,450 Supplies Totals 16,900 $ 944,150 $ 944,150

Accounts payable Accounts receivable Items Additional paid-in capital Buildings (net) (4-year remaining life) Cash and short-term investments Debit $ 41,000 Credit $ 53,700 50,000 184,000 77,250 Common stock 250,000 Equipment (net) (5-year remaining life) Inventory 400,000 117,500 Land Long-term Liabilities (mature 12/31/26) 107,500 Retained earnings, 1/1/23 173,000 417,450 Supplies Totals 16,900 $ 944,150 $ 944,150

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter13: Investments And Long-term Receivables

Section: Chapter Questions

Problem 8MC

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During 2021, Anthony Company purchased debt securities as a long-term investment and classified them as trading. All securities were purchased at par value. Pertinent data are as follows: The net holding gain or loss included in Anthonys income statement for the year should be: a. 0 b. 3,000 gain c. 9,000 loss d. 12,000 loss
Chapman Company obtains 100 percent of Abernethy Company's stock on January 1, 2023. As of that date, Abernethy has the following trial balance: Items Debit Accounts payable Accounts receivable Credit $ 56,700 $ 43,800 Cash and short-term investments Additional paid-in capital Buildings (net) (4-year remaining life) Common stock 50,000 143,000 80,250 250,000 Equipment (net) (5-year remaining life) Inventory 295,000 110,500 Land 112,000 Long-term liabilities (mature 12/31/26) Retained earnings, 1/1/23 171,000 268,750 Supplies 11,900 Totals $ 796,450 $ 796,450 During 2023, Abernethy reported net income of $122,500 while declaring and paying dividends of $15,000. During 2024, Abernethy reported net income of $159,250 while declaring and paying dividends of $49,000. Assume that Chapman Company acquired Abernethy's common stock by paying $744,750 in cash. All of Abernethy's accounts are estimated to have a fair value approximately equal to present book values. Chapman uses the partial…
rroDiems 19 through 21 should be viewed as independent situations. They are based on the following data: Chapman Company obtains 100 percent of Abernethy Company's stock on January 1, 2020. As of that date, Abernethy has the following trial balance: Page 136 Debit Credit Accounts payable $ 50,000 Accounts receivable $ 40,000 Additional paid-in capital Buildings (net) (4-year remaining life) 50,000 120,000 Cash and short-term investments 60,000 Common stock 250,000 Equipment (net) (5-year remaining life) Inventory 200,000 90,000 Land 80,000 Long-term liabilities (mature 12/31/23) 150,000 Retained earnings, 1/1/20 100,000 Supplies 10,000 $600,000 $600,000 Totals During 2020, Abernethy reported net income of $80,000 while declaring and paying dividends of $ 10,000. During 2021, Abernethy reported net income of $110,000 while declaring and paying dividends of $30,000. LO 3-3a 1. Assume that Chapman Company acquired Abernethy's common stock for $490,000 in cash. As of January 1, 2020,…
Chapman Company obtains 100 percent of Abernethy Company's stock on January 1, 2020. As of that date, Abernethy has the following trial balance: Debit Credit $ 57,300 Accounts payable Accounts receivable $ 42,200 Additional paid-in capital 50,000 214,000 Buildings (net) (4-year remaining life) Cash and short-term investments Common stock 82,250 250,000 Equipment (net) (5-year remaining Life) 375,000 Inventory 90,500 Land 117,000 170,000 Long-term liabilities (mature 12/31/23) Retained earnings, 1/1/20 409,650 Supplies 16,000 Totals $936,950 $ 936,950 During 2020, Abernethy reported net income of $117,500 while declaring and paying dividends of $15,000. During 2021, Abernethy reported net income of $171,250 while declaring and paying dividends of $55,000. Assume that Chapman Company acquired Abernethy's common stock for $816,280 in cash. Assume that the equipment and long-term liabilities had fair values of $396,950 and $140,720, respectively, on the acquisition date. Chapman uses the…
Chapman Company obtains 100 percent of Abernethy Company's stock on January 1, 2020. As of that date, Abernethy has the following trial balance: Credit $ 57,300 Debit Accounts payable Accounts receivable Additional paid-in capital Buildings (net) (4-year renaining life) Cash and short-term investnents Common stock Equipment (net) (5-year remaining life) Inventory Land Long-tern liabilities (mature 12/31/23) Retained earnings, 1/1/20 Supplies Totals $ 42,200 50, 000 214, 000 82,250 250,000 375,000 98,500 117,000 170,000 409,650 16, 000 $936,950 $ 936, 950 During 2020, Abernethy reported net income of $117,500 while declaring and paying dividends of $15.000. During 2021, Abernethy reported net income of $171,250 while declaring and paying dividends of $55,000, Assume that Chapman Company acquired Abernethy's common stock for $816.280 in cash. Assume that the equipment and long-term liabilities had fair values of $396,950 and $140,720. respectively, on the acquisition date. Chapman uses…
Chapman Company obtains 100 percent of Abernethy Company's stock on January 1, 2020. As of that date, Abernethy has the following trial balance: Debit Credit 2$ $ 46,600 Accounts payable Accounts receivable Additional paid-in capital Buildings (net) (4-year remaining life) Cash and short-term investments 59,500 50,000 145,000 84, 250 Common stock 250,000 Equipment (net) (5-year remaining life) Inventory 257,500 106, ө00 129,000 Land Long-term liabilities (mature 12/31/23) Retained earnings, 1/1/20 Supplies 151,000 273,050 15, 200 Totals $783,550 $ 783,550 During 2020, Abernethy reported net income of $98,500 while declaring and paying dividends of $12,000. During 2021, Abernethy reported net income of $132,250 while declaring and paying dividends of $48,000. Assume that Chapman Company acquired Abernethy's common stock for $699,850 in cash. As of January 1, 2020, Abernethy's land had a fair value of $141,400, its buildings were valued at $217,400, and its equipment was appraised at…
Chapman Company obtains 100 percent of Abernethy Company’s stock on January 1, 2023. As of that date, Abernethy has the following trial balance: Items Debit Credit Accounts payable - $ 54,100 Accounts receivable $ 48,500 - Additional paid-in capital - 50,000 Buildings (net) (4-year remaining life) 130,000 - Cash and short-term investments 66,000 - Common stock - 250,000 Equipment (net) (5-year remaining life) 437,500 - Inventory 109,000 - Land 89,000 - Long-term liabilities (mature 12/31/26) - 178,500 Retained earnings, 1/1/23 - 358,800 Supplies 11,400 - Totals $ 891,400 $ 891,400 During 2023, Abernethy reported net income of $126,000 while declaring and paying dividends of $16,000. During 2024, Abernethy reported net income of $174,000 while declaring and paying dividends of $49,000. Assume that Chapman Company acquired Abernethy’s common stock for $765,230 in cash. Assume that the equipment and long-term liabilities had fair values of $458,150 and…
hapman Company obtains 100 percent of Abernethy Company’s stock on January 1, 2020. As of that date, Abernethy has the following trial balance: Debit Credit Accounts payable $ 56,700 Accounts receivable $ 43,800 Additional paid-in capital 50,000 Buildings (net) (4-year remaining life) 143,000 Cash and short-term investments 80,250 Common stock 250,000 Equipment (net) (5-year remaining life) 295,000 Inventory 110,500 Land 112,000 Long-term liabilities (mature 12/31/23) 171,000 Retained earnings, 1/1/20 268,750 Supplies 11,900 Totals $ 796,450 $ 796,450 During 2020, Abernethy reported net income of $122,500 while declaring and paying dividends of $15,000. During 2021, Abernethy reported net income of $159,250 while declaring and paying dividends of $49,000. Assume that Chapman Company acquired Abernethy’s common stock for $698,050 in cash. As of…
Chapman Company obtains 100 percent of Abernethy Company’s stock on January 1, 2023. As of that date, Abernethy has the following trial balance: Items Debit Credit Accounts payable - $ 56,400 Accounts receivable $ 43,900 - Additional paid-in capital - 50,000 Buildings (net) (4-year remaining life) 217,000 - Cash and short-term investments 76,750 - Common stock - 250,000 Equipment (net) (5-year remaining life) 367,500 - Inventory 96,500 - Land 122,000 - Long-term liabilities (mature 12/31/26) - 182,500 Retained earnings, 1/1/23 - 396,250 Supplies 11,500 - Totals $ 935,150 $ 935,150 During 2023, Abernethy reported net income of $103,500 while declaring and paying dividends of $13,000. During 2024, Abernethy reported net income of $145,250 while declaring and paying dividends of $47,000. Assume that Chapman Company acquired Abernethy’s common stock for $793,300 in cash. As of January 1, 2023, Abernethy’s land had a fair value of $134,000, its buildings…
Chapman Company obtains 100 percent of Abernethy Company's stock on January 1, 2020. As of that date, Abernethy has the following trial balance: Debit Credit $ 50,500 Accounts payable Accounts receivable Additional paid-in capital Buildings (net) (4-year remaining life) Cash and short-term investments Common stock Equipment (net) (5-year remaining life) Inventory $ 44,100 50,000 166,000 79,250 250,000 292,500 100,500 128,000 Land Long-term liabilities (mature 12/31/23) Retained earnings, 1/1/20 Supplies 188,000 288,850 17,000 Totals $827,350 $ 827,350 During 2020, Abernethy reported net income of $103,000 while declaring and paying dividends of $13,000. During 2021, Abernethy reported net income of $144,250 while declaring and paying dividends of $58,000. Assume that Chapman Company acquired Abernethy's common stock for $694,300 in cash. As of January 1, 2020, Abernethy's land had a fair value of $142,700, its buildings were valued at $210,000, and its equipment was appraised at…
Chapman Company obtains 100 percent of Abernethy Company’s stock on January 1, 2020. As of that date, Abernethy has the following trial balance: Debit Credit Accounts payable $ 52,400 Accounts receivable $ 48,600 Additional paid-in capital 50,000 Buildings (net) (4-year remaining life) 179,000 Cash and short-term investments 61,250 Common stock 250,000 Equipment (net) (5-year remaining life) 260,000 Inventory 121,500 Land 105,000 Long-term liabilities (mature 12/31/23) 174,500 Retained earnings, 1/1/20 264,650 Supplies 16,200 Totals $ 791,550 $ 791,550 During 2020, Abernethy reported net income of $86,000 while declaring and paying dividends of $11,000. During 2021, Abernethy reported net income of $124,500 while declaring and paying dividends of $47,000. Assume that Chapman Company acquired Abernethy’s common stock by paying $752,650 in cash. All…
Chapman Company obtains 100 percent of Abernethy Company’s stock on January 1, 2020. As of that date, Abernethy has the following trial balance: Debit Credit Accounts payable $ 53,700 Accounts receivable $ 41,000 Additional paid-in capital 50,000 Buildings (net) (4-year remaining life) 184,000 Cash and short-term investments 77,250 Common stock 250,000 Equipment (net) (5-year remaining life) 400,000 Inventory 117,500 Land 107,500 Long-term liabilities (mature 12/31/23) 173,000 Retained earnings, 1/1/20 417,450 Supplies 16,900 Totals $ 944,150 $ 944,150 During 2020, Abernethy reported net income of $98,000 while declaring and paying dividends of $12,000. During 2021, Abernethy reported net income of $128,250 while declaring and paying dividends of $39,000. Assume that Chapman Company acquired Abernethy’s common stock for $851,300 in cash. As of…