On January 1, 2022, Aronsen Company acquired 90 percent of Sledel Company's outstanding shares. Sledel had a net book value on that date of $450,000: common stock ($12 par value) of $240,000 and retained earnings of $210,000. Aronsen paid $691,200 for this Investment. The acquisition-date fair value of the 10 percent noncontrolling Interest was $76,800. The excess fair value over book value associated with the acquisition was used to increase land by $222,000 and to recognize copyrights (12-year remaining life) at $96,000. Subsequent to the acquisition, Aronsen applied the Initial value method to its Investment account. In the 2022-2023 period, the subsidiary's retained earnings Increased by $230,000. During 2024, Siedel earned Income of $94,000 while declaring $34,000 in dividends. Also, at the beginning of 2024, Siedel Issued 4,000 new shares of common stock for $52 per share to finance the expansion of its corporate facilities. Aronsen purchased none of these additional shares and therefore recorded no entry. Required: Prepare the appropriate 2024 consolidation entries for these two companies. Note: If no entry is required for a transaction/event, select "No Journal entry required" in the first account field. view transaction list Consolidation Worksheet Entries 2 3 5 6 Prepare Entry C1 to record the adjustment for the subsidiary stock transaction. Note: Enter debits before credits. Transaction Accounts Entry C1 Investment in Siedel Additional paid-in capital (Aronsen) Debit Credit 3,450 3,450 Record entry Clear entry view consolidation entries
On January 1, 2022, Aronsen Company acquired 90 percent of Sledel Company's outstanding shares. Sledel had a net book value on that date of $450,000: common stock ($12 par value) of $240,000 and retained earnings of $210,000. Aronsen paid $691,200 for this Investment. The acquisition-date fair value of the 10 percent noncontrolling Interest was $76,800. The excess fair value over book value associated with the acquisition was used to increase land by $222,000 and to recognize copyrights (12-year remaining life) at $96,000. Subsequent to the acquisition, Aronsen applied the Initial value method to its Investment account. In the 2022-2023 period, the subsidiary's retained earnings Increased by $230,000. During 2024, Siedel earned Income of $94,000 while declaring $34,000 in dividends. Also, at the beginning of 2024, Siedel Issued 4,000 new shares of common stock for $52 per share to finance the expansion of its corporate facilities. Aronsen purchased none of these additional shares and therefore recorded no entry. Required: Prepare the appropriate 2024 consolidation entries for these two companies. Note: If no entry is required for a transaction/event, select "No Journal entry required" in the first account field. view transaction list Consolidation Worksheet Entries 2 3 5 6 Prepare Entry C1 to record the adjustment for the subsidiary stock transaction. Note: Enter debits before credits. Transaction Accounts Entry C1 Investment in Siedel Additional paid-in capital (Aronsen) Debit Credit 3,450 3,450 Record entry Clear entry view consolidation entries
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:On January 1, 2022, Aronsen Company acquired 90 percent of Sledel Company's outstanding shares. Sledel had a net book value on
that date of $450,000: common stock ($12 par value) of $240,000 and retained earnings of $210,000.
Aronsen paid $691,200 for this Investment. The acquisition-date fair value of the 10 percent noncontrolling Interest was $76,800. The
excess fair value over book value associated with the acquisition was used to increase land by $222,000 and to recognize copyrights
(12-year remaining life) at $96,000. Subsequent to the acquisition, Aronsen applied the Initial value method to its Investment account.
In the 2022-2023 period, the subsidiary's retained earnings Increased by $230,000. During 2024, Siedel earned Income of $94,000
while declaring $34,000 in dividends. Also, at the beginning of 2024, Siedel Issued 4,000 new shares of common stock for $52 per
share to finance the expansion of its corporate facilities. Aronsen purchased none of these additional shares and therefore recorded
no entry.
Required:
Prepare the appropriate 2024 consolidation entries for these two companies.
Note: If no entry is required for a transaction/event, select "No Journal entry required" in the first account field.
view transaction list
Consolidation
Worksheet Entries
2
3
5
6
Prepare Entry C1 to record the adjustment for the subsidiary stock transaction.
Note: Enter debits before credits.
Transaction
Accounts
Entry C1
Investment in Siedel
Additional paid-in capital (Aronsen)
Debit
Credit
3,450
3,450
Record entry
Clear entry
view consolidation entries
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 1 steps
Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education