Peanut Company acquired 100 percent of Snoopy Company's outstanding common stock for $313,000 on January 1, 20X8, when the book value of Snoopy's net assets was equal to $313,000. Peanut uses the equity method to account for investments Trial balance data for Peanut and Snoopy as of December 31, 20X8, are as follows: Cash Accounts Receivable. Inventory Investment in Snoopy Company Land Buildings & Equipment. Cost of Goods Sold Depreciation Expense Selling & Administrative Expense Dividends Declared Accumulated Depreciation Accounts Payable Bonds Payable Comeon Stock Retained Earnings Sales Income from Snoopy Company Total Peanut Company Debit $ 149,000 178,000 204,000 328,000 214,000 700,000 204,000 63,000 225,000 107,000 Credit Snoopy Company Debit Credit $ 73,000 75,000 81,000 0 97,000 188,000 145,000 14,000 51,000 37,000 $443,000 59,000 193,000 493,000 352,000 750,000 $2,000 $3,372,000 $2,372,000 $761,000 $761,000 $ 25,000 44,000 114,000 204,000 109,000 262,000 (Assume the company prepares the optional Accumulated Depreciation Elimination Entry) Required: à Prepare the journal entries on Peanut's books for the acquisition of Snoopy on January 1, 20X8/as well as any normal equity method entrylies) related to the investment in Snoopy Company during 20X8 (if no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Peanut Company acquired 100 percent of Snoopy Company's outstanding common stock for $313,000 on January 1, 20X8, when the book value of Snoopy's net assets was equal to $313,000. Peanut uses the equity method to account for investments Trial balance data for Peanut and Snoopy as of December 31, 20X8, are as follows: Cash Accounts Receivable. Inventory Investment in Snoopy Company Land Buildings & Equipment. Cost of Goods Sold Depreciation Expense Selling & Administrative Expense Dividends Declared Accumulated Depreciation Accounts Payable Bonds Payable Comeon Stock Retained Earnings Sales Income from Snoopy Company Total Peanut Company Debit $ 149,000 178,000 204,000 328,000 214,000 700,000 204,000 63,000 225,000 107,000 Credit Snoopy Company Debit Credit $ 73,000 75,000 81,000 0 97,000 188,000 145,000 14,000 51,000 37,000 $443,000 59,000 193,000 493,000 352,000 750,000 $2,000 $3,372,000 $2,372,000 $761,000 $761,000 $ 25,000 44,000 114,000 204,000 109,000 262,000 (Assume the company prepares the optional Accumulated Depreciation Elimination Entry) Required: à Prepare the journal entries on Peanut's books for the acquisition of Snoopy on January 1, 20X8/as well as any normal equity method entrylies) related to the investment in Snoopy Company during 20X8 (if no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Peanut Company acquired 100 percent of Snoopy Company's outstanding common stock for $313,000 on January 1, 20X8, when the
book value of Snoopy's net assets was equal to $313,000. Peanut uses the equity method to account for investments Trial balance
data for Peanut and Snoopy as of December 31, 20X8, are as follows:
Cash
Accounts Receivable
Inventory
Investment in Snoopy Company
Land
Buildings & Equipment.
Cost of Goods Sold
Depreciation Expense
Selling & Administrative Expense.
Dividends Declared i
Accumulated Depreciation
Accounts Payable
Bonds Payable
Comeon Stock
Retained Earnings
Sales
Income from Snoopy Company
Total
Peanut Company
Debit
$ 149,000
178,000
204,000
328,000
214,000
700,000
204,000
63,000
225,000
107,000
Credit
$443,000
59,000
193,000
493,000
352,000
750,000
$2,000
$3,372,000 $2,372,000
Snoopy Company
Debit Credit
$ 73,000
75,000
81,000
0
97,000
188,000
145,000
14,000
51,000
37,000
$ 25,000
44,000
114,000
204,000
109,000
262,000
$761,000 $761,000
(Assume the company prepares the optional Accumulated Depreciation Elimination Entry
Required:
à Prepare the journal entries on Peanut's books for the acquisition of Snoopy on January 1, 20X8/as well as any normal equity method
entrylies) related to the investment in Snoopy Company during 20X8 (if no entry is required for a transaction/event, select "No
journal entry required" in the first account field.)
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