In early January 2023, Flounder Inc., a private enterprise that applies ASPE, purchased 40% of the common shares of Washi Corp. for$361,000. Flounder was now able to exercise considerable influence in decisions made by Washi's management. Washi's statement offinancial position reported the following information at the date of acquisition:Assets not subject to being amortizedAssets subject to depreciation (10 years average life remaining)LiabilitiesAdditional information:1.2.3.4.(a)$180,000546,000101,000Both the carrying amount and fair value are the same for non-depreciable assets and for liabilities.The fair value of the assets subject to depreciation is $660,000.The company depreciates its capital assets on a straight-line basis.Washi reported net income of $143,000 and declared and paid dividends of $99,000 in 2023.Prepare the journal entry to record Flounder's investment in Washi. Assume that any unexplained payment is goodwill. (Creditaccount titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" forthe account titles and enter O for the amounts. List debit entry before credit entry.)Account Titles and ExplanationDebitCredit b. Assuming Flounder Inc applies the equity method to account for its investment in Washi,prepare the journal entries to record Flounder Inc's equity in the net income and the receipt ofdividends from Washi Corp. in 2023.Account TitlesCashInvestment in Associate(To record collection of dividend)Investment In AssociateInvestment Income or Loss(To record investment income)(To record depreciation of fair value difference)Debit Credit

Journal entry is the first stage of the accounting process.Journal entries are used to record…

In early January 2023, Flounder Inc., a private enterprise that applies ASPE, purchased 40% of the common shares of Washi Corp. for $361,000. Flounder was now able to exercise considerable influence in decisions made by Washi's management. Washi's statement of financial position reported the following information at the date of acquisition: Assets not subject to being amortized Assets subject to depreciation (10 years average life remaining) Liabilities Additional information: 1. 2. 3. 4. $180,000 546,000 101,000 Both the carrying amount and fair value are the same for non-depreciable assets and for liabilities. The fair value of the assets subject to depreciation is $660,000. The company depreciates its capital assets on a straight-line basis. Washi reported net income of $143,000 and declared and paid dividends of $99,000 in 2023.

In early January 2023, Flounder Inc., a private enterprise that applies ASPE, purchased 40% of the common shares of Washi Corp. for $361,000. Flounder was now able to exercise considerable influence in decisions made by Washi's management. Washi's statement of financial position reported the following information at the date of acquisition: Assets not subject to being amortized Assets subject to depreciation (10 years average life remaining) Liabilities Additional information: 1. 2. 3. 4. $180,000 546,000 101,000 Both the carrying amount and fair value are the same for non-depreciable assets and for liabilities. The fair value of the assets subject to depreciation is $660,000. The company depreciates its capital assets on a straight-line basis. Washi reported net income of $143,000 and declared and paid dividends of $99,000 in 2023.

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, 2020, Pail Corporation acquired 75 percent of Sand Company's common stock for $525,000 cash. The fair value of the noncontrolling interest at that date was determined to be $175,000. At the date of the business combination, the book values of Sand's net assets and liabilities approximated fair value except for depreciable plant assets, which were UNDERvalued by $4000 and Inventory, which was OVERvalued by $4500 The remaining useful life of the plant assets was set at 10 years. For the year ended December 31, 2020, Pail reported Depreciation Expense of $15000 on its general ledger. Sand reported Depreciation Expense of $9000 on its general ledger. What amount of Depreciation Expense should be reported on the 12/31/20 consolidated Income Statement?
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PLEASE GIVE ANSWER 13&14 BOTH
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