Martinez’s journal entries
Q: On January 1, 2020, Erika Company (Erika) purchased 62% interest in Finn Limited (Finn) for…
A: Depreciation on equipment over 5 years (2016 - 2020) = $2300000 x 5years/ 10 years = $1150000 book…
Q: On June 30, 2020, Cape Company purchased 25% of the outstanding ordinary shares of Bit Co. at a…
A: Under the fair value method, the investment is reported at the fair value of the market share of the…
Q: On April 1, 2020, Republic Company sold equipment to its wholly owned subsidiary, Barre Corporation,…
A: Working Note: 1. The original cost of the asset is = $60,000 2. The Accumulated depreciation is =…
Q: The Holtz Corporation acquired 80 percent of the 100,000 outstanding voting shares of Devine, Inc.,…
A: Given, Outstanding voting rights is 100,000 Acquired 80% NCI traded price is $4.76 Remaining 20%…
Q: On January 1, 2021, Brooks Corporation exchanged $1,180,500 fair-value consideration for all of the…
A: Gain on bargain purchase. Particular Amount Consideration transfer by book corporation…
Q: On January 1, 2019, Field Company acquired 40% of North Company by purchasing 8,000 shares for…
A: SOLUTION A JOURNAL IS THE COMPANY'S OFFICIAL BOOK IN WHICH TRANSACTIONS ARE RECORDED IN…
Q: On January 1, 2020, McIlroy, Inc., acquired a 60 percent interest in the common stock of Stinson,…
A: A journal entry is a form of accounting entry that is used to report a business transaction in a…
Q: On January 1, 2021, Brooks Corporation exchanged $1,259,000 fair-value consideration for all of the…
A: The quantity of money in a financial repository during the current accounting period is known as an…
Q: Harper, Inc., acquires 40 percent of the outstanding voting stock of Kinman Company on January 1,…
A: Equity accounting: Equity accounting is a process for recording investments in associated companies.…
Q: On January 1, 2020, Corgan Company acquired 80 percent of the outstanding voting stock of Smashing,…
A: Consolidation: When it comes to corporate consolidation, the phrase refers to the merging of many…
Q: On January 1, 2020, Corgan Company acquired 80 percent of the outstanding voting stock of Smashing,…
A: Format:- Annual amortization Consideration transferred Add: Non controlling interest…
Q: Equity method balance in Phillips's Investment in Bearden, Inc., account as of December 31, 2022.…
A: Consolidation: A process in which many smaller companies get amalgamated through merger and…
Q: On January 1, 2020, McIlroy, Inc., acquired a 60 percent interest in the common stock of Stinson,…
A: Acquisition-date fair value allocation and excess amortizations a. Consideration transferred…
Q: On January 1, 2021, Cameron Inc. bought 20% of the outstanding common stock of Lake Construction…
A: 1.
Q: On January 1, 2020, QuickPort Company acquired 90 percent of the outstanding voting stock of…
A: Equity Method:- It is a method of accounting and this method applies when a company's ownership…
Q: Harper, Inc., acquires 40 percent of the outstanding voting stock of Kinman Company on January 1,…
A: Journal entry is a record of financial transactions in the books of accounts of a business. It…
Q: Nizwa Corp maintains the investment account in Al Izz Corp using the equity method. During 2019, Al…
A: Investment balance amount shown is step 2
Q: On January 1, 2017, Palka, Inc., acquired 70 percent of the outstanding shares of Sellinger Company…
A:
Q: On January 1, 2020, QuickPort Company acquired 90 percent of the outstanding voting stock of…
A: Given:Outstanding voting stock = $ 1,125,000Common stock = $ 1,170,000Retained earnings = $…
Q: On January 1, 2020, Alison, Inc., paid $83,800 for a 40 percent interest in Holister Corporation’s…
A: Solution Common stock can be defined as securities that represent individuals ownership in a said…
Q: On January 1, 2020, QuickPort Company acquired 90 percent of the outstanding voting stock of…
A: Equity Balance Method - It if type of accounting method used at the time of investors holds…
Q: On January 1, 2020, Corgan Company acquired 80 percent of the outstanding voting stock of Smashing,…
A:
Q: In January 2020, Domingo, Inc., acquired 20 percent of the outstanding common stock of Martes, Inc.,…
A: The question is based on the concept of financial accounting.
Q: On May 31, 2021 Armstrong paid $3,500,000 to acquire all of the common stock of Police Corp which…
A: Goodwill is an intangible asset. It is the value of company's brand name, solid customer base, good…
Q: On July 1, 2019, Killearn Company acquired 120,000 of the outstanding shares of Shaun Company for…
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Q: Harper, Inc., acquires 40 percent of the outstanding voting stock of Kinman Company on January 1,…
A: Journal Entry - It is record of each and every business transactions whether it is economic or non…
Q: On January 1, 2021, Pine Company owns 40 percent (76,000 shares) of Seacrest, Ic., which it…
A: If a company have ownership in another company, its assets and liabilities are subject to…
Q: On July 1, 2019, Killearn Company acquired 138,000 of the outstanding shares of Shaun Company for…
A: Income earned 2019=Income ×612=$641,000×612=$320,500
Q: On January 1, 2020, Mcllroy, Inc., acquired a 60 percent interest in the common stock of Stinson,…
A:
Q: On January 1, 2021, Brooks Corporation exchanged $1,259,000 fair-value consideration for all of the…
A:
Q: On January 1, 2020, Corgan Company acquired 80 percent of the outstanding voting stock of Smashing,…
A: PLEASE LIKE THE ANSWER: Following information given in question Consideration transferred by…
Q: On January 3, 2020, Gladstone Corporation purchased 30% of the outstanding voting common stock of…
A: In the equity method, we recognizes investment at cost. In this method, the value of investment is…
Q: Pitino acquired 90 percent of Brey's outstanding shares on January 1, 2019, in exchange for $342,000…
A: A business combination is a transaction in which a buyer takes over control of another company (the…
Q: On January 1, 2020, QuickPort Company acquired 90 percent of the outstanding voting stock of…
A:
Q: On January 1, 2021, Patter Corp. purchased 80% of the outstanding shares of Saturn Co. at a cost of…
A: Solution Working- 1- Amortization excess = 50000/4 =12500. 2-Inter company dividend =…
Q: In January 2020, Domingo, Inc., acquired 20 percent of the outstanding common stock of Martes, Inc.,…
A: The equity method is a technique in accountancy that a firm uses to recognize earnings out of its…
Q: Pitino acquired 90 percent of Brey's outstanding shares on January 1, 2019, in exchange for $342,000…
A: Intra entity transaction refers to the transfer price which is more than the cost of the inventory.…
Q: On January 1, 2021, Brooks Corporation exchanged $1,235,000 fair-value consideration for all of the…
A: Consolidated Work Sheet: Consolidated financial statements of a parent and its subsidiaries is…
Q: BuyCo, Inc., holds 20 percent of the outstanding shares of Marqueen Company and appropriately…
A: The stock that a company's investors own on the open market is referred to as outstanding shares.…
Q: ompany's net assets. P13,000 of the excess is attributed to an undervalued equipment with a…
A:
Q: On January 1, 2020, Corgan Company acquired 80 percent of the outstanding voting stock of Smashing,…
A: The report data given by Smashing is as follows,
Q: On January 1, 2019, GRANGER Co. acquired 80% interest in HISTORIA, Inc. by issuing 5,000 shares with…
A: Consolidated financial statements are those statements that states the cash flows, assets, expenses,…
Q: Hot Inc. owns 60% of Cold Inc, which it purchased on January 1, 2019 for $540,000. On that date,…
A: Working note: Computation of fair value of identifiable net assets and non-controlling interest of C…
Q: In January 2020, Domingo, Inc., acquired 20 percent of the outstanding common stock of Martes, Inc.,…
A: The equity method indicates determining the value of the investment by considering the income and…
Q: and other consideration. At the acquisition date, Smashing had common stock of $810,000, retained…
A: Given : Corgan Company acquired 70 percent of the outstanding voting stock of Smashing, Inc., for a…
Q: On January 1, 2017, Palka, Inc., acquired 70 percent of the outstanding shares of Sellinger Company…
A: Calculation of additional paid-in capital: Fair value at the time of acquisition: Net Income +…
Q: On January 1, 2020, Panther, Inc., issued securities with a total fair value of $577,000 for 100…
A: Profit = Transfer price - Cost Amortization = Value assigned / Life ( in years )
Q: On January 1, 2017, Corgan Company acquired 70 percent of the outstanding voting stock of Smashing,…
A: The following calculations are done to show the adjustments after the acquisition of Smashing Co. by…
Q: On June 1, 2020, Straw Company acquired 20% equivalent to 20,000 shares of Berry Company for…
A: Introduction:- A controlling interest in a corporation is one that owns enough voting stock shares…
Q: Harper, Inc., acquires 40 percent of the outstanding voting stock of Kinman Company on January 1,…
A: A journal entry is used to record day-to-day transactions of the business by debiting and crediting…
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- On January 3, 2020, Gladstone Corporation purchased 30% of the outstanding voting common stock of Hancock Company for $610,000. This purchase gave Gladstone the ability to exercise significant influence over the operating and financial policies of Hancock. On the date of purchase, Hancock's books reported assets of $3,000,000 and liabilities of $800,000. Any excess of cost over book value of Gladstone's investment was attributed to a patent with a remaining useful life of ten years. During 2020, Hancock reported net income of $295,000 and declared and paid cash dividends of $80,000. In the following year, 2021, Hancock reported net income of $325,000 and declared and paid cash dividends of $75,000. In 2020, Gladstone sold inventory costing $55,000 to Hancock for $70,000. Hancock sold 65% of that inventory to outsiders during 2020 with the remainder being sold in 2021. During 2021, Gladstone sold inventory costing $45,000 to Hancock for $85,000. Hancock sold 90% of that inventory to…During January 2023, Nelson, Inc. acquired 40% of the outstanding common stock of Fuel Co. for $1,800,000. This investment gave Nelson the ability to exercise significant influence over Fuel. Fuel's assets on that date were recorded at $7,000,000 with liabilities of $4,000,000. Any excess of cost over book value of Nelson's investment was attributed to unrecorded patents having a remaining useful life of ten years. In 2023, Fuel reported net income of $500,000 and paid dividends of $20,000. What was the reported balance of Nelson's Investment in Fuel Co. at December 31, 2023? O a $1,968,000 Ob $3,000.000 O $2,100,000 Od $1,800,000 Oe $2.224.000On January 1, 2020, Alison, Inc., paid $83,800 for a 40 percent interest in Holister Corporation’s common stock. This investee had assets with a book value of $290,500 and liabilities of $117,000. A patent held by Holister having a $13,600 book value was actually worth $31,600. This patent had a six-year remaining life. Any further excess cost associated with this acquisition was attributed to goodwill. During 2020, Holister earned income of $40,700 and declared and paid dividends of $14,000. In 2021, it had income of $70,000 and dividends of $19,000. During 2021, the fair value of Allison’s investment in Holister had risen from $95,380 to $106,180. Assuming Alison uses the equity method, what balance should appear in the Investment in Holister account as of December 31, 2021? Assuming Alison uses fair-value accounting, what income from the investment in Holister should be reported for 2021?
- In January 2020, Marcus, Inc., acquired 20 percent of the outstanding common stock of Lily, Inc., for $769,000. This investment gave Marcus the ability to exercise significant influence over Lily, whose balance sheet on that date showed total assets of $4,199,000 with liabilities of $909,000. Any excess of cost over book value of the investment was attributed to a patent having a remaining useful life of 10 years. In 2020, Lily reported net income of $222,000. In 2021, Lily reported net income of $268,250. Dividends of $79,000 were declared in each of these two years. What is the equity method balance of Marcus's Investment in Lily, Inc., at December 31, 2021? Multiple Choice $919,150. $813,250. $835,450. $908,050.On January 1, 2023, Bertrand Incorporated paid $70,800 for a 40% interest in Chestnut Corporation's common stock. This investee had assets with a book value of $235,000 and liabilities of $95000. A patent held by Chestnut having a book value of $8900 was actually worth $25,400. This patent had a six year remaining life. Any further excess cost associated with this acquisition was attributed to an indefinite-lived asset. During 2023, Chestnut earned income of $45,700 and declared and paid dividends of $20,000. During 2024, the fair value of Bertrand's investment in Chestnut had risen from $84,080 to $88,960. Assuming Bertrand uses the quity method, what balnace should appear in the investment in Chestnut account as of December 31, 2024? Assuming Bertrand uses fair-value accounting, what income from the investment in Chestnut should be reported for 2024?On January 1, 2021, Pine Company owns 40 percent (84,000 shares) of Seacrest, Ic., which it purchased several years ago for $449,400. Since the date of acquisition, the equity method has been properly applied, and the carrying amount of the investment account as of January 1, 2021, is $588,000. Excess patent cost amortization of $25,200 is still being recognized each year. During 2021, Seacrest reports net income of $606,000 and a $252,000 other comprehensive loss, both incurred uniformly throughout the year. No dividends were declared during the year. Pine sold 16,800 shares of Seacrest on August 1, 2021, for $170,401 in cash. However, Pine retains the ability to significantly influence the investee. During the last quarter of 2020, Pine sold $61,000 in inventory (which it had originally purchased for only $36,600) to Seacrest. At the end of that fiscal year, Seacrest's inventory retained $13,300 (at sales price) of this merchandise, which was subsequently sold in the first quarter of…
- On January 1, 2021, Pine Company owns 40 percent (76,000 shares) of Seacrest, Inc., which it purchased several years ago for $423,700. Since the date of acquisition, the equity method has been properly applied, and the carrying amount of the investment account as of January 1, 2021, is $549,100. Excess patent cost amortization of $22,800 is still being recognized each year. During 2021, Seacrest reports net income of $558,000 and a $228,000 other comprehensive loss, both incurred uniformly throughout the year. No dividends were declared during the year. Pine sold 15,200 shares of Seacrest on August 1, 2021, for $165,354 in cash. However, Pine retains the ability to significantly influence the investee. During the last quarter of 2020, Pine sold $59,000 in inventory (which it had originally purchased for only $35,400) to Seacrest. At the end of that fiscal year, Seacrest's inventory retained $14,600 (at sales price) of this merchandise, which was subsequently sold in the first quarter…On January 1, 2021, Pine Company owns 40 percent (140,000 shares) of Seacrest, Inc., which it purchased several years ago for $644,000. Since the date of acquisition, the equity method has been properly applied, and the carrying amount of the investment account as of January 1, 2021, is $875,000. Excess patent cost amortization of $42,000 is still being recognized each year. During 2021, Seacrest reports net income of $942,000 and a $420,000 other comprehensive loss, both incurred uniformly throughout the year. No dividends were declared during the year. Pine sold 28,000 shares of Seacrest on August 1, 2021, for $223,454 in cash. However, Pine retains the ability to significantly influence the investee. During the last quarter of 2020, Pine sold $75,000 in inventory (which it had originally purchased for only $45,000) to Seacrest. At the end of that fiscal year, Seacrest's inventory retained $12,300 (at sales price) of this merchandise, which was subsequently sold in the first quarter…On January 1, 2018, Pine Company owns 40 percent (40,000 shares) of Seacrest, Inc., which it purchased several years ago for $182,000. Since the date of acquisition, the equity method has been properly applied, and the carrying amount of the investment account as of January 1, 2018, is $293,600. Excess patent cost amortization of $12,000 is still being recognized each year. During 2018, Seacrest reports net income of $342,000 and a $120,000 other comprehensive loss, both incurred uniformly throughout the year. No dividends were declared during the year. Pine sold 8,000 shares of Seacrest on August 1, 2018, for $93,000 in cash. However, Pine retains the ability to significantly influence the investee. During the last quarter of 2017, Pine sold $50,000 in inventory (which it had originally purchased for only $30,000) to Seacrest. At the end of that fiscal year, Seacrest’s inventory retained $10,000 (at sales price) of this merchandise, which was subsequently sold in the first quarter of…
- On January 3, 2021, Matteson Corporation acquired 30 percent of the outstanding common stock of O'Toole Company for $1,462, 000. This acquisition gave Matteson the ability to exercise significant influence over the investee. The book value of the acquired shares was $859, 000. Any excess cost over the underlying book value was assigned to a copyright that was undervalued on its balance sheet. This copyright has a remaining useful life of 10 years. For the year ended December 31, 2021, O'Toole reported net income of $350, 000 and declared cash dividends of $45, 000. On December 31, 2021, what should Matteson report as its investment in O'Toole under the equity method?On January 1, 2018, Pine Company owns 40 percent (40,000 shares) of Seacrest, Inc., which it purchased several years ago for $182,000. Since the date of acquisition, the equity method has been properly applied, and the carrying amount of the investment account as of January 1, 2018, is $293,600. Excess patent cost amortization of $12,000 is still being recognized each year. During 2018, Seacrest reports net income of $342,000 and a $120,000 other comprehensive loss, both incurred uniformly throughout the year. No dividends were declared during the year. Pine sold 8,000 shares of Seacrest on August 1, 2018, for $93,000 in cash. However, Pine retains the ability to significantly influence the investee.During the last quarter of 2017, Pine sold $50,000 in inventory (which it had originally purchased for only $30,000) to Seacrest. At the end of that fiscal year, Seacrest’s inventory retained $10,000 (at sales price) of this merchandise, which was subsequently sold in the first quarter of…On July 1, 2019, Killearn Company acquired 138,000 of the outstanding shares of Shaun Company for $20 per share. This acquisition gave Killearn a 40 percent ownership of Shaun and allowed Killearn to significantly influence the investee’s decisions. As of July 1, 2019, the investee had assets with a book value of $6 million and liabilities of $167,750. At the time, Shaun held equipment appraised at $288,750 more than book value; it was considered to have a seven-year remaining life with no salvage value. Shaun also held a copyright with a five-year remaining life on its books that was undervalued by $607,500. Any remaining excess cost was attributable to goodwill. Depreciation and amortization are computed using the straight-line method. Killearn applies the equity method for its investment in Shaun. Shaun's policy is to declare and pay a $1 per share cash dividend every April 1 and October 1. Shaun's income, earned evenly throughout each year, was $641,000 in 2019, $670,000 in…
