Chapman Company obtains 100 percent of Abernethy Company's stock on January 1, 2017. As of that date, Abernethy has thefollowing trial balance:Accounts payableAccounts receivableAdditional paid-in capitalBuildings (net) (4-year remaining life)Cash and short-term investmentsCommon stockEquipment (net) (5-year remaining life)InventoryLandLong-term liabilities (mature 12/31/20)Retained earnings, 1/1/17SuppliesTotalsview transaction listNo1DateDecember 312017Debit$ 44,300137,00073,750transaction list262,500126,500100,500During 2017, Abernethy reported net income of $96,000 while declaring and paying dividends of $12,000. During 2018, Abernethyreported net income of $141,000 while declaring and paying dividends of $45,000.Accounts18,600$763,150Assume that Chapman Company acquired Abernethy's common stock for $651,300 in cash. As of January 1, 2017, Abernethy's landhad a fair value of $111,300, its buildings were valued at $199,400, and its equipment was appraised at $233,500. Chapman uses theequity method for this investment.Common stock - AbernethyAdditional paid-in capitalRetained earnings - 1/1/17Investment in AbernethyCredit$ 59,30050,000Prepare consolidation worksheet entries for December 31, 2017, and December 31, 2018. (If no try is required for atransaction/event, select "No journal entry required" in the first account field.)250,000176,000227,850$763,150DebitCredit******Ⓒ

Chapman Company obtains 100% of Abernethy Company's stock as on 1st Jan 2017. The Stock is acquired…

Answered: Prepare consolidation worksheet entries…

Prepare consolidation worksheet entries for December 31, 2017, and December 31, 2018. (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

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