Pitcher Corporation purchased 60 percent of Softball Corporation's voting common stock on January 1, 20X1 On January 1, 20X5, Pitcher received $240,000 from Softball for a truck Pitcher had purchased on January 1, 20x2, for $300,000. The truck is expected to have a 10-year useful life and no salvage value. Both companies depreciate trucks on a straight line basis Required: a. Prepare the worksheet consolidation entry or entries needed at December 31, 20X5, to remove the effects of the intercompany sale 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 < A Record the entry to eliminate the gain on the truck and to correct the asset's basis. B Note: Enter debits before credits. Event Record entry Accounts Clear entry Debit Credit view consolidation entries >

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Pitcher Corporation purchased 60 percent of Softball Corporation's voting common stock on January 1, 20X1. On January 1, 20X5.
Pitcher received $240,000 from Softball for a truck Pitcher had purchased on January 1, 20x2, for $300,000. The truck is expected to
have a 10-year useful life and no salvage value. Both companies depreciate trucks on a straight-line basis
Required:
a. Prepare the worksheet consolidation entry or entries needed at December 31, 20X5, to remove the effects of the intercompany
sale
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
<
A
Record the entry to eliminate the gain on the truck and to correct the asset's
basis.
B
Note: Enter debits before credits
Event
1
Record entry
Accounts
Clear entry
Debit
Credit
view consolidation entries
Transcribed Image Text:Pitcher Corporation purchased 60 percent of Softball Corporation's voting common stock on January 1, 20X1. On January 1, 20X5. Pitcher received $240,000 from Softball for a truck Pitcher had purchased on January 1, 20x2, for $300,000. The truck is expected to have a 10-year useful life and no salvage value. Both companies depreciate trucks on a straight-line basis Required: a. Prepare the worksheet consolidation entry or entries needed at December 31, 20X5, to remove the effects of the intercompany sale 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 < A Record the entry to eliminate the gain on the truck and to correct the asset's basis. B Note: Enter debits before credits Event 1 Record entry Accounts Clear entry Debit Credit view consolidation entries
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