In 1/1/2024 Smart co. with owner equity (ordinary shares 1,500,0000, premium 2,500,000 and retained earning 1,800,000)purchased 10% of Welly co.with owner equity (ordinary shares 800,0000, premium700,000 and retained earning 1,000,000) byisuing 50,000 of its 25par and 5 market price. In that date the inventory of welly book value was 100,000 and market value140,000, equipment with book value 250,000 and fair market 320,000(7 years) In 31/12/2024 ART income was 280,000 beforerecorded any of DORPY and paid dividend 70,000, and income was 80,000 with 40,000 dividend, the market price share for Smartwas 125 and 75 for welly in 31/12/2024required: journalize all required entries for this investment in 01/01/2024 and 31/12/2024 with any elemination entries in31/12/2024

Detailed Journal Entries for Seesaw Co.'s Investment in MMI1. January 1, 2024:• Debit: Investment…

Answered: In 1/1/2024 Smart co. with owner equity…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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On January 1, 20X9, Ute Company acquired 70 percent of Cougar Company's common shares at the underlying book value. Ute paid $70,000 for the 70% ownership. Ute uses the equity method in accounting for its ownership of Standard. During the year, Ute sold $200K inventory to Cougar. Ute’s original price on the inventory was $150K. At the end of the year Cougar had $30K in ending inventory. Prepare all the equity and eliminating entries needed as of December 31, 20X9, and complete the attached consolidated worksheet (Please fill out the cells with bolded question marks within the consolidated worksheet as well, if you can not find some of the values to replace the question marks, that is ok, but indicate which specific cell you are answering for the ones you do know, thank you).
Acker Company bought 100% of Howell Company on 1/1/X1 for $1,440,000 and began applying the equity method. The book value of Howell's equity on that date was $1,440,000. In year X1, Howell reported net income of $100,000 and paid $40,000 in dividends. During year X1, Howell sold 1,000 units of inventory to Acker for $20,000 that had cost $10,000. On 12/31/X1, 400 of the units remained in Acker's inventory. How much investment income should Acker report in year X1
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