is a wholly owned subsidiary of Point Corporation. Point acquired owner orted net assets. At that date, Stick reported common stock outstanding erential is assigned to equipment with an economic life of seven years att me of $30,000 and paid dividends of $12.000 in 20x3. urnal entries recorded by Point Corporation during 20X3 on its books if F y method. insolidating entries needed at December 31, 20X3, to prepare consolidat
is a wholly owned subsidiary of Point Corporation. Point acquired owner orted net assets. At that date, Stick reported common stock outstanding erential is assigned to equipment with an economic life of seven years att me of $30,000 and paid dividends of $12.000 in 20x3. urnal entries recorded by Point Corporation during 20X3 on its books if F y method. insolidating entries needed at December 31, 20X3, to prepare consolidat
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
i.2
Transcribed Image Text:Stick Corporation is a wholly owned subsidiary of Point Corporation. Point acquired ownership of Stick on January 1, 20X3, for $28,000
above Stick's reported net assets. At that date, Stick reported common stock outstanding of $60,000 and retained earnings of
$90,000. The differential is assigned to equipment with an economic life of seven years at the date of the business combination Stick
reported net income of $30,000 and paid dividends of $12,000 in 20X3.
Required:
a. Prepare the journal entries recorded by Point Corporation during 20X3 on its books if Point accounts for its investment in Stick
using the equity method.
b. Prepare the consolidating entries needed at December 31, 20X3, to prepare consolidated financial statements.
Complete this question by entering your answers in the tabs below.
Required A Required B
Prepare the consolidating entries needed at December 31, 20X3, to prepare consolidated financial statements.
Note: If no entry is required for a transaction/event, select "No journal entry required in the first account field.
View transaction list
Journal entry worksheet
A
B
Record the basic consolidation entry.
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