On January 1, 20X8, Plane Company acquired 80 percent of Scalar Company's ownership for $120,000 cash. At that date, the fair value of the noncontrolling interest was $30,000. The book value of Scalar's net assets at acquisition was $125,000. The book values and fair values of Scalar's assets and liabilities were equal, except for buildings and equipment, which were worth $15,000 more than book value. Buildings and equipment are depreciated on a 10-year basis. Although goodwill is not amortized, the management of Plane concluded at December 31, 20X8, that goodwill from its acquisition of Scalar shares had been impaired and the correct carrying amount was $5,000. Goodwill and goodwill impairment were assigned proportionately to the controlling and noncontrolling shareholders. No additional impairment occurred in 20X9. Trial balance data for Plane and Scalar on December 31, 20X9, are as follows:

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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LAME MM
Item
Cash
Accounts Receivable
Inventory
Land
Buildings and Equipment
Investment in Scalar
Company
Cost of Goods Sold
Wage Expense
Depreciation Expense
Interest Expense
Other Expenses
Dividends Declared
Accumulated Depreciation
Accounts Payable
Wages Payable
Notes Payable
Common Stock
Retained Earnings
Sales
Income from Scalar
Plane Company
Debit
$100,000
60,000
80,000
150,000
300,000
144,800
180,000
50,000
30,000
25,000
40,000
40,000
Credit
$150,000
90,000
30,800
180,000
Scalar Company
Debit
Credit
$30,000
25,000
30,000
50,000
150,000
100,000
34,000
15,000
6,000
21,000
10,000
$36,000
26,000
9,000
50,000
100,000
50,000
200,000
150,000
181,000
400,000
18,000
$1,199,800 $1,199,800 $471,000 $471,000
Create the table for Book Value Calculations as of December 31, 20X9:
Transcribed Image Text:LAME MM Item Cash Accounts Receivable Inventory Land Buildings and Equipment Investment in Scalar Company Cost of Goods Sold Wage Expense Depreciation Expense Interest Expense Other Expenses Dividends Declared Accumulated Depreciation Accounts Payable Wages Payable Notes Payable Common Stock Retained Earnings Sales Income from Scalar Plane Company Debit $100,000 60,000 80,000 150,000 300,000 144,800 180,000 50,000 30,000 25,000 40,000 40,000 Credit $150,000 90,000 30,800 180,000 Scalar Company Debit Credit $30,000 25,000 30,000 50,000 150,000 100,000 34,000 15,000 6,000 21,000 10,000 $36,000 26,000 9,000 50,000 100,000 50,000 200,000 150,000 181,000 400,000 18,000 $1,199,800 $1,199,800 $471,000 $471,000 Create the table for Book Value Calculations as of December 31, 20X9:
On January 1, 20X8, Plane Company acquired 80 percent of Scalar Company's ownership for $120,000 cash. At that date, the fair
value of the noncontrolling interest was $30,000. The book value of Scalar's net assets at acquisition was $125,000. The book values and
fair values of Scalar's assets and liabilities were equal, except for buildings and equipment, which were worth $15,000 more than book
value. Buildings and equipment are depreciated on a 10-year basis. Although goodwill is not amortized, the management of Plane
concluded at December 31, 20X8, that goodwill from its acquisition of Scalar shares had been impaired and the correct carrying
amount was $5,000. Goodwill and goodwill impairment were assigned proportionately to the controlling and noncontrolling
shareholders. No additional impairment occurred in 20X9.
Trial balance data for Plane and Scalar on December 31, 20X9, are as follows:
Transcribed Image Text:On January 1, 20X8, Plane Company acquired 80 percent of Scalar Company's ownership for $120,000 cash. At that date, the fair value of the noncontrolling interest was $30,000. The book value of Scalar's net assets at acquisition was $125,000. The book values and fair values of Scalar's assets and liabilities were equal, except for buildings and equipment, which were worth $15,000 more than book value. Buildings and equipment are depreciated on a 10-year basis. Although goodwill is not amortized, the management of Plane concluded at December 31, 20X8, that goodwill from its acquisition of Scalar shares had been impaired and the correct carrying amount was $5,000. Goodwill and goodwill impairment were assigned proportionately to the controlling and noncontrolling shareholders. No additional impairment occurred in 20X9. Trial balance data for Plane and Scalar on December 31, 20X9, are as follows:
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