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Unformatted text preview: P6-38 Consolidation Workpaper in Year following Intercompany Transfer1/1/02160,000 - .80 (100,000+50,000) = 40,000Goodwill40,000Impairment loss (12/31/06) 25,000Land Sale1/1/05 P <- LCost8,000Sale price18,000Gain10,000Equipment sale P -> L1/1/06Life1/1/01Cost75,00015A/D25,000Book Val50,000105,000Sale price70,000107,000Gain20,0002,000Equity method entries:Investment in S36,000Income from S36,000Net income (45,000 x 80%)Cash28,000Investment in S28,000Dividends (35,000 x 80%)P6-38(continued)b.Eliminating entries, December 31, 20X7:E(1)Income from Subsidiary36,000 Dividends Declared28,000Investment in Lane Company Stock8,000Eliminate income from subsidiary.E(2)Income to Noncontrolling Interest9,000 Dividends Declared7,000Noncontrolling Interest2,000Assign income to noncontrolling interest:$9,000 = $45,000 x .20E(3)Common Stock — Lane Company100,000 Retained Earnings, January 1140,000 Differential40,000 Investment in Lane Company Stock232,000Noncontrolling Interest48,000Eliminate beginning investment balance:...
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- Spring '08
- Impairment, Generally Accepted Accounting Principles, Lane Company, Prime Lane Company Company, Lane Company Stock