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Unformatted text preview: P6-41 Comprehensive Problem: Intercorporate Transfers12/31/012,340,000 - .75(1,000,000+1,350,000+620,000) = 112,500Inventory22,500 (sold in x2)Land40,000Goodwill50,000112,5001/1/08 112,500 22,500 = 90,000Land x2 R -> SConsulting AgreementGain 23,000R ----S$80,000owe: $20KEquipment sale R <- S1/1/08Life12/27/02Cost435,00015A/D145,000*Book Val290,0001029,000Sale price250,0001025,000Loss40,0004,000*435,000 / 15 = 29,000 x 5 yrs = 145,000Equity method entries:Investment in S82,500Income from S82,500Net income (110,000 x 75%)Cash11,250Current Receivable3,750Investment in S15,000Dividends (20,000 x 75%)c.Elimination entries:E(1)Income from Subsidiary82,500 Dividends Declared15,000 Investment in Schmid Stock67,500 Eliminate income from subsidiary.E(2)Income to Noncontrolling Interest36,500 Dividends Declared5,000 Noncontrolling Interest31,500 Ss net income 110,000Add back loss 40,000Less depr. increase ( 4,000)Confirmed NI 146,000 x .25 = 36,500E(3)Common Stock Schmid1,000,000Additional Paid-In Capital...
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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.
- Spring '08