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Homework i Saved Help Save & Exit Submit my work mode: This shows what is correct or incorrect for the work you have completed so far. It does not indicate completion. Return to question The following are selected accounts and balances for Mergaronite Company and Hill, Inc., as of December 31, 2021. Several of Mergaronite's accounts have been omitted. Credit balances are indicated by parentheses. Dividends were declared and paid in the same period. Revenues Cost of goods sold Depreciation expense Investment income Retained earnings, 1/1/21 Dividends declared Current assets Land Buildings (net) Equipment (net) Liabilities Common stock Additional paid-in capital Mergaronite Hill $ (594,000) $ (246,000) 266,000 104,000 NA 106,000 44,000 NA (888,000) (598,000) 140,000 36,000 210,000 696,000 316,000 94,000 510,000 142,000 212,000 240,000 (396,000) (310,000) (292,000) (38,000) (46,000) (922,000) Assume that Mergaronite acquired Hill on January 1, 2017, by issuing 6,600 shares of common stock having a par value of $10 per share but a fair value of $100 each. On January 1, 2017, Hill's land was undervalued by $20,000, its buildings were overvalued by $31,000, and equipment was undervalued by $60,600. The buildings had a 10-year remaining life; the equipment had a 5-year remaining life. A customer list with an appraised value of $104,000 was developed internally by Hill and was estimated to have a 20-year remaining useful life. a. Determine the December 31, 2021, consolidated totals for the following accounts: b. In requirement (a), can the consolidated totals be determined without knowing which method the parent used to account for the subsidiary? c. If the parent uses the equity method, what consolidation entries would be used on a 2021 worksheet? Answer is not complete. < Prev 4 of 5 Next >

Homework i Saved Help Save & Exit Submit my work mode: This shows what is correct or incorrect for the work you have completed so far. It does not indicate completion. Return to question The following are selected accounts and balances for Mergaronite Company and Hill, Inc., as of December 31, 2021. Several of Mergaronite's accounts have been omitted. Credit balances are indicated by parentheses. Dividends were declared and paid in the same period. Revenues Cost of goods sold Depreciation expense Investment income Retained earnings, 1/1/21 Dividends declared Current assets Land Buildings (net) Equipment (net) Liabilities Common stock Additional paid-in capital Mergaronite Hill $ (594,000) $ (246,000) 266,000 104,000 NA 106,000 44,000 NA (888,000) (598,000) 140,000 36,000 210,000 696,000 316,000 94,000 510,000 142,000 212,000 240,000 (396,000) (310,000) (292,000) (38,000) (46,000) (922,000) Assume that Mergaronite acquired Hill on January 1, 2017, by issuing 6,600 shares of common stock having a par value of $10 per share but a fair value of $100 each. On January 1, 2017, Hill's land was undervalued by $20,000, its buildings were overvalued by $31,000, and equipment was undervalued by $60,600. The buildings had a 10-year remaining life; the equipment had a 5-year remaining life. A customer list with an appraised value of $104,000 was developed internally by Hill and was estimated to have a 20-year remaining useful life. a. Determine the December 31, 2021, consolidated totals for the following accounts: b. In requirement (a), can the consolidated totals be determined without knowing which method the parent used to account for the subsidiary? c. If the parent uses the equity method, what consolidation entries would be used on a 2021 worksheet? Answer is not complete. < Prev 4 of 5 Next >

Financial Accounting
Financial Accounting
15th Edition
ISBN:9781337272124
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Carl Warren, James M. Reeve, Jonathan Duchac
Chapter6: Accounting For Merchandising Businesses
Section: Chapter Questions
Problem 5PA: The following selected accounts and their current balances appear in the ledger of Clairemont Co....
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Homework i Saved Help Save & Exit Submit my work mode: This shows what is correct or incorrect for the work you have completed so far. It does not indicate completion. Return to question The following are selected accounts and balances for Mergaronite Company and Hill, Inc., as of December 31, 2021. Several of Mergaronite's accounts have been omitted. Credit balances are indicated by parentheses. Dividends were declared and paid in the same period. Revenues Cost of goods sold Depreciation expense Investment income Retained earnings, 1/1/21 Dividends declared Current assets Land Buildings (net) Equipment (net) Liabilities Common stock Additional paid-in capital Mergaronite Hill $ (594,000) $ (246,000) 266,000 104,000 NA 106,000 44,000 NA (888,000) (598,000) 140,000 36,000 210,000 696,000 316,000 94,000 510,000 142,000 212,000 240,000 (396,000) (310,000) (292,000) (38,000) (46,000) (922,000) Assume that Mergaronite acquired Hill on January 1, 2017, by issuing 6,600 shares of common stock having a par value of $10 per share but a fair value of $100 each. On January 1, 2017, Hill's land was undervalued by $20,000, its buildings were overvalued by $31,000, and equipment was undervalued by $60,600. The buildings had a 10-year remaining life; the equipment had a 5-year remaining life. A customer list with an appraised value of $104,000 was developed internally by Hill and was estimated to have a 20-year remaining useful life. a. Determine the December 31, 2021, consolidated totals for the following accounts: b. In requirement (a), can the consolidated totals be determined without knowing which method the parent used to account for the subsidiary? c. If the parent uses the equity method, what consolidation entries would be used on a 2021 worksheet? Answer is not complete. < Prev 4 of 5 Next >
Transcribed Image Text:Homework i Saved Help Save & Exit Submit my work mode: This shows what is correct or incorrect for the work you have completed so far. It does not indicate completion. Return to question The following are selected accounts and balances for Mergaronite Company and Hill, Inc., as of December 31, 2021. Several of Mergaronite's accounts have been omitted. Credit balances are indicated by parentheses. Dividends were declared and paid in the same period. Revenues Cost of goods sold Depreciation expense Investment income Retained earnings, 1/1/21 Dividends declared Current assets Land Buildings (net) Equipment (net) Liabilities Common stock Additional paid-in capital Mergaronite Hill $ (594,000) $ (246,000) 266,000 104,000 NA 106,000 44,000 NA (888,000) (598,000) 140,000 36,000 210,000 696,000 316,000 94,000 510,000 142,000 212,000 240,000 (396,000) (310,000) (292,000) (38,000) (46,000) (922,000) Assume that Mergaronite acquired Hill on January 1, 2017, by issuing 6,600 shares of common stock having a par value of $10 per share but a fair value of $100 each. On January 1, 2017, Hill's land was undervalued by $20,000, its buildings were overvalued by $31,000, and equipment was undervalued by $60,600. The buildings had a 10-year remaining life; the equipment had a 5-year remaining life. A customer list with an appraised value of $104,000 was developed internally by Hill and was estimated to have a 20-year remaining useful life. a. Determine the December 31, 2021, consolidated totals for the following accounts: b. In requirement (a), can the consolidated totals be determined without knowing which method the parent used to account for the subsidiary? c. If the parent uses the equity method, what consolidation entries would be used on a 2021 worksheet? Answer is not complete. < Prev 4 of 5 Next >
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