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Unformatted text preview: P5-35 and 36 Comprehensive Problem: Differential Apportionment1/1/x7173,000 80% (100,000 + 50,000) = 53,00080%TimeDepr assets33,000113,000Goodwill20,00053,000in 1/1/x8 53,000 3,000 = 50,000Goodwill impairment in 2008 20,000-6000=14,000a.Journal entries recorded by Bigelow Corporation:(1)Investment in Granite Company Stock173,000Cash173,000Purchase of Granite Company stock.(2)Cash16,000Investment in Granite Company Stock16,000Record dividends from Granite Company:$20,000 x .80(3)Investment in Granite Company Stock48,000Income from Subsidiary48,000Record equity-method income:$60,000 x .80(4)Income from Subsidiary3,000Investment in Granite Company Stock3,000Amortize differential assigned todepreciable assets: ($33,000 / 11 years)No equity method entry for goodwill impairmentb.Eliminating entries:E(1)Income from Subsidiary45,000Dividends Declared16,000Investment in Granite Company Stock29,000Eliminate income from subsidiary.E(2)Income to Noncontrolling Interest12,000Dividends Declared4,000Noncontrolling Interest8,000Assign income to noncontrolling interest.E(3)Common Stock Granite Company50,000Retained Earnings, January 1100,000Differential53,000Investment in Granite Company Stock173,000Noncontrolling Interest30,000Eliminate beginning investment balance.E(4)Goodwill20,000Buildings and Equipment33,000Differential53,000Assign beginning differential.E(5)Depreciation Expense3,000Accumulated Depreciation3,000Amortize differential related todepreciable assets....
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- Spring '08