Problem 3-36 (Static) (LO 3-3a) Tyler Company acquired all of Jasmine Company's outstanding stock on January 1, 2022, for $206,000 in cash. Jasmine had a book value of only $140,000 on that date. However, equipment (having an eight-year remaining life) was undervalued by $54,400 on Jasmine's financial records. A building with a 20-year remaining life was overvalued by $10,000 Subsequent to the acquisition, Jasmine reported the following: Year 2022 2023 2024 Net Income $ 50,000 60,000 30,000 In accounting for this investment, Tyler has used the equity method. Selected accounts taken from the financial records of these two companies as of December 31, 2024, follow: Accounts Revenues-operating Dividends Declared $ 10,000 40,000 20,000 Expenses Equipment (net) Buildings (net) Common stock Retained earnings, 12/31/24 Tyler Company $ (310,000) 198,000 320,000 220,000 (290,000) (410,000) Jasmine Company $ (104,000) Required: Determine the following account balances as of December 31, 2024 74,000 50,000 68,000 (50,000) (160,000)
Problem 3-36 (Static) (LO 3-3a) Tyler Company acquired all of Jasmine Company's outstanding stock on January 1, 2022, for $206,000 in cash. Jasmine had a book value of only $140,000 on that date. However, equipment (having an eight-year remaining life) was undervalued by $54,400 on Jasmine's financial records. A building with a 20-year remaining life was overvalued by $10,000 Subsequent to the acquisition, Jasmine reported the following: Year 2022 2023 2024 Net Income $ 50,000 60,000 30,000 In accounting for this investment, Tyler has used the equity method. Selected accounts taken from the financial records of these two companies as of December 31, 2024, follow: Accounts Revenues-operating Dividends Declared $ 10,000 40,000 20,000 Expenses Equipment (net) Buildings (net) Common stock Retained earnings, 12/31/24 Tyler Company $ (310,000) 198,000 320,000 220,000 (290,000) (410,000) Jasmine Company $ (104,000) Required: Determine the following account balances as of December 31, 2024 74,000 50,000 68,000 (50,000) (160,000)
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
Chapter11: Depreciation, Depletion, Impairment, And Disposal
Section: Chapter Questions
Problem 21P
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