Soft Bound Version for Advanced Accounting 13th Edition
Soft Bound Version for Advanced Accounting 13th Edition
13th Edition
ISBN: 9781260110579
Author: Hoyle
Publisher: McGraw Hill Education
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Chapter 4, Problem 34P

a.

To determine

Identify the amount of excess depreciation expense which should be recognized in the consolidated financial statements for the initial years following this acquisition.

b.

To determine

Find the amount of goodwill which should be recognized if a consolidated balance sheet is prepared as of January 1, 2016.

c.

To determine

Identify Entry S and Entry A which should be included if a consolidation worksheet is prepared as of January 1, 2016.

d.

To determine

Determine the amount of investment income which would be reported for 2016 under each of the following accounting methods:

  • The equity method
  • The partial equity method
  • The initial value method

e.

To determine

Identify what would be the December 31, 2018, balance for the Investment in Company T Company account under each of the following accounting methods:

  • The equity method
  • The partial equity method
  • The initial value method

f.

To determine

Find the consolidated balance for the Buildings account.

g.

To determine

Determine balance of consolidated goodwill as of December 31, 2018.

h.

To determine

Determine the consolidated balance of each of these accounts.

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Miller Company acquired an 80 percent interest in Taylor Company on January 1, 2016. Miller paid $952,000 in cash to the owners of Taylor to acquire these shares. In addition, the remaining 20 percent of Taylor shares continued to trade at a total value of $238,000 both before and after Miller’s acquisition. On January 1, 2016, Taylor reported a book value of $546,000 (Common Stock = $273,000; Additional Paid-In Capital = $81,900; Retained Earnings = $191,100). Several of Taylor’s buildings that had a remaining life of 20 years were undervalued by a total of $72,800. During the next three years, Taylor reports income and declares dividends as follows: YearNet IncomeDividends2016$63,900 $9,200 2017 82,800  13,800 2018 92,000  18,400   Determine the appropriate answers for each of the following questions:aWhat amount of excess depreciation expense should be recognized in the consolidated financial statements for the initial years following this acquisition?bIf a consolidated balance…
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