View the step-by-step solution to:

Put Company paid $220,000 for an 80% interest in Sel Company on July 1, 2011, when Sel Company had total equity of $110,000.

Put Company paid $220,000 for an 80% interest in Sel Company on July 1, 2011, when Sel Company had total equity of $110,000. Sel Company reported earnings of $10,000 for 2011 and declared dividends of $8,000 on November 1, 2011.
REQUIRED: Give the entries to record these facts on the books of Put Company:
1. Assuming that Put Company uses the cost method of accounting for its subsidiaries.
2. Assuming that Put Company uses the equity method of accounting for its subsidiaries. (Any difference between investment cost and book value acquired is to be assigned to equipment and amortized over a 10-year period.)

Sign up to view the entire interaction

Top Answer

Hi Student, please find... View the full answer

8422619.docx

Answer
1. Assuming that Put Company uses the cost method of accounting for its subsidiaries. Journal Entries Date Particulars Amount $ Amount $ 2011 Investment in Sel Company 220,000 Cash 220,000...

Sign up to view the full answer

Why Join Course Hero?

Course Hero has all the homework and study help you need to succeed! We’ve got course-specific notes, study guides, and practice tests along with expert tutors.

-

Educational Resources
  • -

    Study Documents

    Find the best study resources around, tagged to your specific courses. Share your own to gain free Course Hero access.

    Browse Documents
  • -

    Question & Answers

    Get one-on-one homework help from our expert tutors—available online 24/7. Ask your own questions or browse existing Q&A threads. Satisfaction guaranteed!

    Ask a Question
Ask a homework question - tutors are online