4-24 - P4-24 Comprehensive Problem: Consolidation in...

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Unformatted text preview: P4-24 Comprehensive Problem: Consolidation in Subsequent Period$240,000 100% (100,000 +100,000) = 40,000BVFMV100%lifeAmort.B&E (net)40,000104,000GoodwillTotal40,000Balance 12/31/x3 = $40,000 2(4,000) = $32,000a.Journal entries recorded by Thompson Company:(1)Cash12,000Investment in Lake Corporation Stock12,000Record dividends from subsidiary.(2)Investment in Lake Corporation Stock32,000Income from Subsidiary32,000Record equity-method income.(3)Income from Subsidiary4,000Investment in Lake Corporation Stock4,000Amortize differential: $40,000 / 10 yearsb.Eliminating entries:E(1)Income from Subsidiary28,000Dividends Declared12,000Investment in Lake Corporation Stock16,000Eliminate income from subsidiary.E(2)Common Stock Lake Corporation100,000Retained Earnings, January 1120,000Differential32,000Investment in Lake Corporation Stock252,000Eliminate beginning investment balance.E(3)Buildings and Equipment40,000Accumulated Depreciation8,000Differential32,000Assign purchase differential.Assign purchase differential....
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This note was uploaded on 04/18/2008 for the course ACCT cost taught by Professor Staff during the Spring '08 term at Oklahoma State.

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4-24 - P4-24 Comprehensive Problem: Consolidation in...

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