Eliminating Entries After First and Second Years During 2023, Peerless Company's wholly-owned subsidiary, Safeco Inc. reported net income of $2.100,000 and declared and paid dividends of $800.000. Peerless acquired Safeco on January 2, 202 a cash cost of $10,000,000, which was $6,000,000 in excess of the book value of net assets acquired. Safeco's equipment (5-year life) was overvalued by $500,000. Its inventory, reported using FIFO, overvalued by $200,000. The remaining excess of acquisition cost over book value was attributed to goodwill. Impairment testing indicates that goodwill was impaired by $100,000 during 2023. Saf date of acquisition inventory was sold during 2023. Required Prepare the necessary eliminating entries to consolidate the financial statements of Peerless and Safeco at December 31, 2023, Enter numerical answers using all zeros (do not abbreviate in thousands or in millions).

Eliminating Entries After First and Second Years During 2023, Peerless Company's wholly-owned subsidiary, Safeco Inc. reported net income of $2.100,000 and declared and paid dividends of $800.000. Peerless acquired Safeco on January 2, 202 a cash cost of $10,000,000, which was $6,000,000 in excess of the book value of net assets acquired. Safeco's equipment (5-year life) was overvalued by $500,000. Its inventory, reported using FIFO, overvalued by $200,000. The remaining excess of acquisition cost over book value was attributed to goodwill. Impairment testing indicates that goodwill was impaired by $100,000 during 2023. Saf date of acquisition inventory was sold during 2023. Required Prepare the necessary eliminating entries to consolidate the financial statements of Peerless and Safeco at December 31, 2023, Enter numerical answers using all zeros (do not abbreviate in thousands or in millions).

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

1. PKT Ltd acquired 80% of the ordinary shares of CF Ltd. The net assets were fairly valued on 1 January 2021 except for machinery that were undervalued by R550 000. The machine was purchased on 1 January 2020 for R1 250 000 and had a useful life of 5 years. No adjustments at acquisition for the above matter. Required: Prepare the journal entries (with narrations) for the year ended 31 December 2022. Assume a tax Rate of 30% 1.2. PKT Ltd wanted to achieve a 25% GP for each sale completed. Inventory sales between AB and CF Ltd amounted to R1875 000 for the year ended 31 December 2022. Inventory on hand in CF Ltd previously Purchased from PKT Ltd: R620 000 (31 December 2022) R750 000 (31 December 2021) Required: Prepare the journal entries (with narrations) for the year ended 31 December 2022. Assume a tax rate of 30%.
Please answer in text form without image,, every entry should have narrated
company's accounting year ends December 31. Date of Acquisition Cost 9/20/23 $38,000 10/2/23 14,000 Investment Colt Company stock Dana Company stock What amount is reported for gain or loss on these securities in 2023 income? Select one: O a. $800 loss O Fair Value 12/31/23 Date Sold Selling Price $37,000 2/10/24 $42,000 14,200 1/17/24 13,000 b. $1,000 loss c. No gain or loss d. $3,000 gain ہے
Please do not give solution in image format thanku
Parent Corporation acquired 80% of Subsidiary Co. for P 5,000,000 on January 2, 2021. On this date, Subsidiary Co. reported Ordinary share capital of P 3,000,000 and Retained Earnings of P2,000,000. Investment is accounted for using the cost method. Change in assets to fair values were undervaluation of P 300,000 and P400,000 in Equipment and Building respectively. Both assets have 10-year remaining useful life. An annual review revealed that goodwill has not been impaired.Subsidiary Co. earned income and paid dividends as follows: 2021 2022 2023Net Income 1,000,000 1,200,000 1,3000,000Dividends 400,000 500,000 600,000The balance of the investment account at December 31, 2023 is: a. P5,924,000 b. P5,000,000 c. P5,744,000 d. P7,660,000
answer step by step
On January 1, 2019, Triple A Company acquired Bodyguard Company’s outstanding common stock for $842,000 in cash. As of that date the following information was acquired from Bodyguard, the subsidiary of Triple A: Building (12-year life) was undervalued on its balance sheet by $72,000 Equipment (10-year life) was undervalued by $10,000 Licensing agreement (20-year life) unrecorded, assessed at $40,000 Book value as at January 1, 2019 was $720,000 Net income reported during 2019 was $100,000 Dividends paid in 2019 $30,000 Earnings by Bodyguard (subsidiary) in 2020 $120,000 Dividends distributed by Bodyguard in 2020 $20,000 As of December 31, 2021Triple A and Bodyguard reported the following for the year: Triple A December 31, 2021 Bodyguard December 31, 2021 Debit Credit Debit Credit Buildings $1,540,000 $460,000 Cash and receivables 50,000 90,000 Common stock $900,000 $400,000 Dividends paid 70,000 10,000 Equipment…
Luxemburg Company purchased the following investments during 2021: Initial Cost Transaction cost Fair value Year-end 2021 Security A P180,000 P5,000 P170,000 Security B 150,000 2,500 120,500 On July 31, 2022, the entity sold all of the shares of Security B for P125,800. On December 31, 2022, the shares of Security A had a fair value of P205,000. No other activity occurred during 2022 concerning the portfolio. Retained earnings before any adjustments on equity securities on December 31, 2022, is P975,000. Assuming nontrading securities, how much is the Retained earnings on December 31, 2022?