Plug Products owns 80 percent of the stock of Spark Filter Company, which it acquired at underlying book value on August 30, 20X6. At that date, the fair value of the noncontrolling interest was equal to 20 percent of the book value of Spark Filter. Summarized trial balance data for the two companies as of December 31, 20X8, are as follows:   Plug Products Spark Filter Company Credit Debit Credit Debit Cash and Accounts Receivable $ 149,000   $ 110,000   Inventory 239,000   116,000   Buildings and Equipment (net) 281,000   183,000   Investment in Spark Filter Company 264,640       Cost of Goods Sold 174,000   139,000   Depreciation Expense 40,000   30,000   Current Liabilities   $ 178,200   $ 65,000 Common Stock   200,000   89,000 Retained Earnings   464,000   210,000 Sales   264,000   214,000 Income from Spark Filter Company   41,440     Total $ 1,147,640 $ 1,147,640 $ 578,000 $ 578,000 On January 1, 20X8, Plug's inventory contained filters purchased for $70,000 from Spark Filter, which had produced the filters for $50,000. In 20X8, Spark Filter spent $110,000 to produce additional filters, which it sold to Plug for $154,000. By December 31, 20X8, Plug had sold all filters that had been on hand January 1, 20X8, but continued to hold in inventory $46,200 of the 20X8 purchase from Spark Filter. Prepare all consolidation entries needed to complete a consolidation worksheet for 20X8. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question

Plug Products owns 80 percent of the stock of Spark Filter Company, which it acquired at underlying book value on August 30, 20X6. At that date, the fair value of the noncontrolling interest was equal to 20 percent of the book value of Spark Filter. Summarized trial balance data for the two companies as of December 31, 20X8, are as follows:

  Plug Products Spark Filter Company
Credit Debit Credit Debit
Cash and Accounts Receivable $ 149,000   $ 110,000  
Inventory 239,000   116,000  
Buildings and Equipment (net) 281,000   183,000  
Investment in Spark Filter Company 264,640      
Cost of Goods Sold 174,000   139,000  
Depreciation Expense 40,000   30,000  
Current Liabilities   $ 178,200   $ 65,000
Common Stock   200,000   89,000
Retained Earnings   464,000   210,000
Sales   264,000   214,000
Income from Spark Filter Company   41,440    
Total $ 1,147,640 $ 1,147,640 $ 578,000 $ 578,000

On January 1, 20X8, Plug's inventory contained filters purchased for $70,000 from Spark Filter, which had produced the filters for $50,000. In 20X8, Spark Filter spent $110,000 to produce additional filters, which it sold to Plug for $154,000. By December 31, 20X8, Plug had sold all filters that had been on hand January 1, 20X8, but continued to hold in inventory $46,200 of the 20X8 purchase from Spark Filter.

  1. Prepare all consolidation entries needed to complete a consolidation worksheet for 20X8.

    Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.

AI-Generated Solution
AI-generated content may present inaccurate or offensive content that does not represent bartleby’s views.
steps

Unlock instant AI solutions

Tap the button
to generate a solution

Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education