Pharoah Co. acquired 25% of the 530,000 shares of outstanding common stock of Bloom Inc. on December 31, 2025. The purchase price was $3,657,000. Bloom declared and paid $1.30 per share cash dividends on June 18, 2026, and on November 29, 2026. Bloom reported net income of $1,260,000 for 2026. The fair value of Bloom common stock was $27 per share at December 31, 2026. (a) Prepare the journal entries for Pharoah Co. for 2026, assuming that Pharoah cannot exercise significant influence over Bloom. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit

Pharoah Co. acquired 25% of the 530,000 shares of outstanding common stock of Bloom Inc. on December 31, 2025. The purchase price was $3,657,000. Bloom declared and paid $1.30 per share cash dividends on June 18, 2026, and on November 29, 2026. Bloom reported net income of $1,260,000 for 2026. The fair value of Bloom common stock was $27 per share at December 31, 2026. (a) Prepare the journal entries for Pharoah Co. for 2026, assuming that Pharoah cannot exercise significant influence over Bloom. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Consolidation

Consolidation in general examination implies an asset oscillating between well-defined methods of trading status. Consolidation is commonly known as market indecisiveness, which completes when the asset's values move forward or backward the trading structure.

Question

Pharoah Co. acquired 25% of the 530,000 shares of outstanding common stock of Bloom Inc. on December 31, 2025. The purchase
price was $3,657,000. Bloom declared and paid $1.30 per share cash dividends on June 18, 2026, and on November 29, 2026. Bloom
reported net income of $1,260,000 for 2026. The fair value of Bloom common stock was $27 per share at December 31, 2026.
(a)
Prepare the journal entries for Pharoah Co. for 2026, assuming that Pharoah cannot exercise significant influence over Bloom.
(Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No
Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries. Record journal entries in the order
presented in the problem.)
Date
Account Titles and Explanation
Debit
Credit

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