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No 1 2 Date December 31, 202 December 31, 2021 3 December 31, 202 4 December 31, 202 1 5 December 31, 202 1 8 December 31, 202|1 7 December 31, 202 8 December 31, 202 9 December 31, 202|1 10 December 31, 202| C 11 December 31, 202 ' Accounts , Debit Credit Legume Company obtains 100 percent of Brad Company's stock on January 1, 2020. As of that date, Brad has the following trial balance: Items Debit Accounts payable Accounts receivable Credit - $59,900 $43,700 Additional paid-in capital 50,000 Buildings (net) (4-year remaining life) 123,000 Cash and short-term investments 80,500 Common stock 250,000 Equipment (net) (5-year remaining 270,000 life) Inventory 138,500 Land 118,500 Long-term liabilities (mature 175,000 12/31/23) Retained earnings, 1/1/20 257,100 Supplies 17,800 Totals $792,000 $792,000 During 2020, Brad reported net income of $112,000 while declaring and paying dividends of $14,000. During 2021, Brad reported net income of $163,250 while declaring and paying dividends of $54,000. Assume that Legume Company acquired Brad's common stock for $651,550 in cash. As of January 1, 2020, Brad's land had a fair value of $132,100, its buildings were valued at $166,600, and its equipment was appraised at $242,750. Brad uses the equity method for this investment. Required: Prepare consolidation worksheet entries for December 31, 2020, and December 31, 2021. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.

No 1 2 Date December 31, 202 December 31, 2021 3 December 31, 202 4 December 31, 202 1 5 December 31, 202 1 8 December 31, 202|1 7 December 31, 202 8 December 31, 202 9 December 31, 202|1 10 December 31, 202| C 11 December 31, 202 ' Accounts , Debit Credit Legume Company obtains 100 percent of Brad Company's stock on January 1, 2020. As of that date, Brad has the following trial balance: Items Debit Accounts payable Accounts receivable Credit - $59,900 $43,700 Additional paid-in capital 50,000 Buildings (net) (4-year remaining life) 123,000 Cash and short-term investments 80,500 Common stock 250,000 Equipment (net) (5-year remaining 270,000 life) Inventory 138,500 Land 118,500 Long-term liabilities (mature 175,000 12/31/23) Retained earnings, 1/1/20 257,100 Supplies 17,800 Totals $792,000 $792,000 During 2020, Brad reported net income of $112,000 while declaring and paying dividends of $14,000. During 2021, Brad reported net income of $163,250 while declaring and paying dividends of $54,000. Assume that Legume Company acquired Brad's common stock for $651,550 in cash. As of January 1, 2020, Brad's land had a fair value of $132,100, its buildings were valued at $166,600, and its equipment was appraised at $242,750. Brad uses the equity method for this investment. Required: Prepare consolidation worksheet entries for December 31, 2020, and December 31, 2021. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.

Cornerstones of Financial Accounting
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
ChapterA2: Investments
Section: Chapter Questions
Problem 24E
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No 1 2 Date December 31, 202 December 31, 2021 3 December 31, 202 4 December 31, 202 1 5 December 31, 202 1 8 December 31, 202|1 7 December 31, 202 8 December 31, 202 9 December 31, 202|1 10 December 31, 202| C 11 December 31, 202 ' Accounts , Debit Credit
Transcribed Image Text:No 1 2 Date December 31, 202 December 31, 2021 3 December 31, 202 4 December 31, 202 1 5 December 31, 202 1 8 December 31, 202|1 7 December 31, 202 8 December 31, 202 9 December 31, 202|1 10 December 31, 202| C 11 December 31, 202 ' Accounts , Debit Credit
Legume Company obtains 100 percent of Brad Company's stock on January 1, 2020. As of that date, Brad has the following trial balance: Items Debit Accounts payable Accounts receivable Credit - $59,900 $43,700 Additional paid-in capital 50,000 Buildings (net) (4-year remaining life) 123,000 Cash and short-term investments 80,500 Common stock 250,000 Equipment (net) (5-year remaining 270,000 life) Inventory 138,500 Land 118,500 Long-term liabilities (mature 175,000 12/31/23) Retained earnings, 1/1/20 257,100 Supplies 17,800 Totals $792,000 $792,000 During 2020, Brad reported net income of $112,000 while declaring and paying dividends of $14,000. During 2021, Brad reported net income of $163,250 while declaring and paying dividends of $54,000. Assume that Legume Company acquired Brad's common stock for $651,550 in cash. As of January 1, 2020, Brad's land had a fair value of $132,100, its buildings were valued at $166,600, and its equipment was appraised at $242,750. Brad uses the equity method for this investment. Required: Prepare consolidation worksheet entries for December 31, 2020, and December 31, 2021. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
Transcribed Image Text:Legume Company obtains 100 percent of Brad Company's stock on January 1, 2020. As of that date, Brad has the following trial balance: Items Debit Accounts payable Accounts receivable Credit - $59,900 $43,700 Additional paid-in capital 50,000 Buildings (net) (4-year remaining life) 123,000 Cash and short-term investments 80,500 Common stock 250,000 Equipment (net) (5-year remaining 270,000 life) Inventory 138,500 Land 118,500 Long-term liabilities (mature 175,000 12/31/23) Retained earnings, 1/1/20 257,100 Supplies 17,800 Totals $792,000 $792,000 During 2020, Brad reported net income of $112,000 while declaring and paying dividends of $14,000. During 2021, Brad reported net income of $163,250 while declaring and paying dividends of $54,000. Assume that Legume Company acquired Brad's common stock for $651,550 in cash. As of January 1, 2020, Brad's land had a fair value of $132,100, its buildings were valued at $166,600, and its equipment was appraised at $242,750. Brad uses the equity method for this investment. Required: Prepare consolidation worksheet entries for December 31, 2020, and December 31, 2021. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
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