Concept explainers
a.
Introduction: Consolidation is a process in which financial statements of a subsidiary is merged with financial statements of the parent. In this process, the effect of intercompany transactions is eliminated.
To match: The accounts of Company P with the responses.
b.
Introduction: Consolidation is a process in which financial statements of a subsidiary is merged with financial statements of the parent. In this process, the effect of intercompany transactions is eliminated.
To match: The accounts of Company P with the responses.
c.
Introduction: Consolidation is a process in which financial statements of a subsidiary is merged with financial statements of the parent. In this process, the effect of intercompany transactions is eliminated.
To match: The accounts of Company P with the responses.
d.
Introduction: Consolidation is a process in which financial statements of a subsidiary is merged with financial statements of the parent. In this process, the effect of intercompany transactions is eliminated.
To match: The accounts of Company P with the responses.
e.
Introduction: Consolidation is a process in which financial statements of a subsidiary is merged with financial statements of the parent. In this process, the effect of intercompany transactions is eliminated.
To match: The accounts of Company P with the responses.
f.
Introduction: Consolidation is a process in which financial statements of a subsidiary is merged with financial statements of the parent. In this process, the effect of intercompany transactions is eliminated.
To match: The accounts of Company P with the responses.
g.
Introduction: Consolidation is a process in which financial statements of a subsidiary is merged with financial statements of the parent. In this process, the effect of intercompany transactions is eliminated.
To match: The accounts of Company P with the responses.
h.
Introduction: Consolidation is a process in which financial statements of a subsidiary is merged with financial statements of the parent. In this process, the effect of intercompany transactions is eliminated.
To match: The accounts of Company P with the responses.
i.
Introduction: Consolidation is a process in which financial statements of a subsidiary is merged with financial statements of the parent. In this process, the effect of intercompany transactions is eliminated.
To match: The accounts of Company P with the responses.
j.
Introduction: Consolidation is a process in which financial statements of a subsidiary is merged with financial statements of the parent. In this process, the effect of intercompany transactions is eliminated.
To match: The accounts of Company P with the responses.
k.
Introduction: Consolidation is a process in which financial statements of a subsidiary is merged with financial statements of the parent. In this process, the effect of intercompany transactions is eliminated.
To match: The accounts of Company P with the responses.
l.
Introduction: Consolidation is a process in which financial statements of a subsidiary is merged with financial statements of the parent. In this process, the effect of intercompany transactions is eliminated.
To match: The accounts of Company P with the responses.
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Advanced Accounting
- a) Prepare the worksheet for preparing a consolidated statement of financial position on the date of acquisition. You may add accounts to the worksheet that may be necessary.b) Prepare a consolidated statement of financial position for Parker Company and subsidiary on January 2, 2020.arrow_forwardIn Bell Group's consolidation worksheet, the opening balance of retained earnings under 'group' column shows a balance of 70000. If there is a debit entry of 16000 in the NCI column, the opening balance of retained earnings under 'parent' column could be: A. 86000 B. 54000 C. 70000 D. 16000 Please show entries or details to explain.arrow_forwardWhat amount will be shown on the July 1, 20X1, consolidated balance sheet for the following: Total equity Now assume this transaction had been completed prior to the elimination of poolings of interest, and that the pooling method had been used to record the acquisition. Redo requirements 1 and 2: Total assets Total liabilities Total equityarrow_forward
- Lee Manufacturing Corporation was incorporated on January 3, 2018. The corporations financial statements for its first years operations were not examined by a CPA. You have been engaged to examine the financial statements for the year ended December 31, 2019, and your examination is substantially completed. Lees trial balance at December 31, 2019, appears as follows: The following information relates to accounts that may vet require adjustment: 1. Patents for Lees manufacturing process were acquired January 2, 2019, at a cost of 68,000. An additional 17,000 was spent in December 2019 to improve machinery covered by the patents and charged to the Patent account. Depreciation on fixed assets has been properly recorded for 2019 in accordance with Lees practice which provides a full years depreciation for property on hand June 30 and no depreciation otherwise. Lee uses the straight-line method fix all depreciation and amortization and amortizes its patents over their legal life. 2. On January 3. 2018, Lee purchased licensing Agreement No. 1, which was believed to have an indefinite useful life. The balance in the licensing Agreement No. 1 account includes its purchase price of 48,000 and costs of 2,000 related to the acquisition. On January 1, 2019, Lee purchased licensing Agreement No. 2, which has a life expectancy of 10 years. The balance in the Licensing Agreement No. 2 account includes its 48,000 purchase price and 2,000 in acquisition costs, but it has been reduced by a credit of 1,000 for the advance collection of 2020 revenue from the agreement. In late December 2018, an explosion caused a permanent 60% reduction in the expected revenue-producing value of licensing Agreement No. 1, and in January 2020 a flood caused additional damage that rendered the agreement worthless. 3. The balance in the Goodwill account includes (a) 8,000 paid December 30, 2018, for newspaper advertising for the next 4 years following the payment, and (b) legal costs of 16,000 incurred for Lees incorporation on January 3, 2018. 4. The Leasehold Improvements account includes (a) the 15,000 cost of improvements with a total estimated useful life of 12 years, which Lee, as tenant, made to leased premises in January 2018; (b) movable assembly line equipment costing 8,500 that was installed in the leased premises in December 2019; and (c) real estate taxes of 2,500 paid by Lee in 2019, which under the terms of the lease should have been paid by the land-lord. Lee paid its rent in full during 2019. A 10-year nonrenewable lease was signed January 3, 2018, fix the leased building that Lee used in manufacturing operations. 5. The balance in the Organization Costs account includes costs incurred during the organizational period. Required: Prepare a worksheet (spreadsheet) to adjust accounts that require adjustment and prepare financial statements. Formal adjusting journal entries and financial statements are not required. No intangible assets are impaired at the end of 2019. Ignore income taxes.arrow_forwardLogan Corp. has incurred losses from operations for many years. At the recommendation of the newly hired president, the board of directors noted to implement a quasi-reorganization, subject to the stockholders' and creditors' approval. Immediately, prior to the quasi-reorganization, on June 30, 2016, Logan's balance sheet was as follows: Assets Current assets P1,375,000 Property, plant and equipment 3,375,000 Other noncurrent assets 500,000 Total assets P5,250,000 Liabilities and Stockholders' Equity Total liabilities P1,500,000 Ordinary shares, P10 par value…arrow_forwardWhich of the following are examples of the correct application/interpretation of the going concern assumption? Select one: O a. The sole shareholder of Monterey Bay Awnings, Inc. plans to liquidate the business in 15 to 20 years, but still continues to record acquired assets at historical cost. Ob. IBM, a stable company, reports the historical cost of its fixed assets in its balance sheet. c. Trexco, a company filing for liquidation, has restated its balance sheet to show the estimated net realizable value of its assets. d. Both B and C are correct examples. e. All the above are correct examples.arrow_forward
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- Intermediate Accounting: Reporting And AnalysisAccountingISBN:9781337788281Author:James M. Wahlen, Jefferson P. Jones, Donald PagachPublisher:Cengage Learning