Pop Corporation acquired 70 percent of Soda Company's voting common shares on January 1, 20X2, for $108,500. At that date, the noncontrolling interest had a fair value of $46,500 and Soda reported $70,000 of common stock outstanding and retained earnings of $30,000. The differential is assigned to buildings and equipment, which had a fair value $20,000 higher than book value and a remaining 10-year life, and to patents, which had a fair value $35,000 higher than book value and a remaining life of five years at the date of the business combination. Trial balances for the companies as of December 31, 20X3, are as follows:     Pop Corporation   Soda Company   Item   Debit   Credit   Debit   Credit   Cash & Accounts Receivable   $ 15,400           $ 21,600             Inventory     165,000             35,000             Land     80,000             40,000             Buildings & Equipment     340,000             260,000             Investment in Soda Company     109,600                           Cost of Goods Sold     186,000             79,800             Depreciation Expense     20,000             15,000             Interest Expense     16,000             5,200             Dividends Declared     30,000             15,000             Accumulated Depreciation         $ 140,000             $ 80,000     Accounts Payable           92,400               35,000     Bonds Payable           200,000               100,000     Bond Premium                           1,600     Common Stock           120,000               70,000     Retained Earnings           127,900               60,000     Sales           260,000               125,000     Other Income           13,600                     Income from Soda Company           8,100                         $ 962,000   $ 962,000     $ 471,600     $ 471,600       On December 31, 20X2, Soda purchased inventory for $32,000 and sold it to Pop for $48,000. Pop resold $27,000 of the inventory (i.e., $27,000 of the $48,000 acquired from Soda) during 20X3 and had the remaining balance in inventory at December 31, 20X3.   During 20X3, Soda sold inventory purchased for $60,000 to Pop for $90,000, and Pop resold all but $24,000 of its purchase. On March 10, 20X3, Pop sold inventory purchased for $15,000 to Soda for $30,000. Soda sold all but $7,600 of the inventory prior to December 31, 20X3. Assume Pop uses the fully adjusted equity method, that both companies use straight-line depreciation, and that no property, plant, and equipment has been purchased since the acquisition.   Required: a. Prepare all consolidation entries needed to prepare a full set of consolidated financial statements at December 31, 20X3, for Pop and Soda. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Please help with below: Record the basic consolidation entry. Note: Enter debits before credits.         Entry Accounts Debit Credit 1 Common stock       Retained earnings       Investment in Soda Company       NCI in NI of Soda Company       Dividends declared       Investment in Soda Company       NCI in NA of Soda Company         Record the amortized excess value reclassification entry. Note: Enter debits before credits.         Entry Accounts Debit Credit 2 Amortization expense       Depreciation expense       Income from Soda Company       NCI in NI of Soda Company Record the excess value (differential) reclassification entry. Note: Enter debits before credits.         Entry Accounts Debit Credit 3 Buildings and equipment       Patents       Accumulated depreciation       Income from Soda Company       NCI in NI of Soda Company

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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Pop Corporation acquired 70 percent of Soda Company's voting common shares on January 1, 20X2, for $108,500. At that date, the noncontrolling interest had a fair value of $46,500 and Soda reported $70,000 of common stock outstanding and retained earnings of $30,000. The differential is assigned to buildings and equipment, which had a fair value $20,000 higher than book value and a remaining 10-year life, and to patents, which had a fair value $35,000 higher than book value and a remaining life of five years at the date of the business combination. Trial balances for the companies as of December 31, 20X3, are as follows:
 

  Pop Corporation   Soda Company  
Item   Debit   Credit   Debit   Credit  
Cash & Accounts Receivable   $ 15,400           $ 21,600            
Inventory     165,000             35,000            
Land     80,000             40,000            
Buildings & Equipment     340,000             260,000            
Investment in Soda Company     109,600                          
Cost of Goods Sold     186,000             79,800            
Depreciation Expense     20,000             15,000            
Interest Expense     16,000             5,200            
Dividends Declared     30,000             15,000            
Accumulated Depreciation         $ 140,000             $ 80,000    
Accounts Payable           92,400               35,000    
Bonds Payable           200,000               100,000    
Bond Premium                           1,600    
Common Stock           120,000               70,000    
Retained Earnings           127,900               60,000    
Sales           260,000               125,000    
Other Income           13,600                    
Income from Soda Company           8,100                    
    $ 962,000   $ 962,000     $ 471,600     $ 471,600    
 


On December 31, 20X2, Soda purchased inventory for $32,000 and sold it to Pop for $48,000. Pop resold $27,000 of the inventory (i.e., $27,000 of the $48,000 acquired from Soda) during 20X3 and had the remaining balance in inventory at December 31, 20X3.
 
During 20X3, Soda sold inventory purchased for $60,000 to Pop for $90,000, and Pop resold all but $24,000 of its purchase. On March 10, 20X3, Pop sold inventory purchased for $15,000 to Soda for $30,000. Soda sold all but $7,600 of the inventory prior to December 31, 20X3. Assume Pop uses the fully adjusted equity method, that both companies use straight-line depreciation, and that no property, plant, and equipment has been purchased since the acquisition.
 
Required:
a. Prepare all consolidation entries needed to prepare a full set of consolidated financial statements at December 31, 20X3, for Pop and Soda. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Please help with below:

  • Record the basic consolidation entry.
Note: Enter debits before credits.
 
 
 
 
Entry Accounts Debit Credit
1 Common stock    
  Retained earnings    
  Investment in Soda Company    
  NCI in NI of Soda Company    
  Dividends declared    
  Investment in Soda Company    
  NCI in NA of Soda Company    
   
  • Record the amortized excess value reclassification entry.
Note: Enter debits before credits.
 
 
 
 
Entry Accounts Debit Credit
2 Amortization expense    
  Depreciation expense    
  Income from Soda Company    
  NCI in NI of Soda Company
  • Record the excess value (differential) reclassification entry.
Note: Enter debits before credits.
 
 
 
 
Entry Accounts Debit Credit
3 Buildings and equipment    
  Patents    
  Accumulated depreciation    
  Income from Soda Company    
  NCI in NI of Soda Company    
   
 
 
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