Proceed Company acquired of the common stock of Stop Company on January 1, year one, for On that date, Stop had the following trial balance: account debit $250,000 Additional paid in capital Building (12-year life) Common stock Current assets Equipment (6-yr life) Land Liabilities (due in 4 years) Retained earnings 1/year 1 Totals 180,000 160,000 110,000 310,000 120,000 $700,000 $700,000 During year one, Stop reported net income of credit $100,000 170,000 During year one, Stop paid dividends of During year two, Stop reported net income of During year two, Stop paid dividends of On January 1, year one, fair values of some Stop's accounts were: Land Building Equipment $122,000 $262,000 $172.000 Part A. Use the data for the Proceed Company acquisition of the Stop Company to prepare the consolidation worksheet entries. (such as consolidation entry S, A,...) for December 31 of year one. 100% Part B. Use the data for the Proceed Company acquisition of the Stop Company to prepare the consolidation worksheet entries (such as consolidation entry S. A...) for December 31 of year two. $600,000 $50,000 $30,000 There was no impairment of any goodwill arising from the acquisition. Please indicate clearly which method (Equity, Partial Equity, or Initial Value) you choose for Proceed to use to account for its acquisition of Stop Company. $80,000 $40,000
Proceed Company acquired of the common stock of Stop Company on January 1, year one, for On that date, Stop had the following trial balance: account debit $250,000 Additional paid in capital Building (12-year life) Common stock Current assets Equipment (6-yr life) Land Liabilities (due in 4 years) Retained earnings 1/year 1 Totals 180,000 160,000 110,000 310,000 120,000 $700,000 $700,000 During year one, Stop reported net income of credit $100,000 170,000 During year one, Stop paid dividends of During year two, Stop reported net income of During year two, Stop paid dividends of On January 1, year one, fair values of some Stop's accounts were: Land Building Equipment $122,000 $262,000 $172.000 Part A. Use the data for the Proceed Company acquisition of the Stop Company to prepare the consolidation worksheet entries. (such as consolidation entry S, A,...) for December 31 of year one. 100% Part B. Use the data for the Proceed Company acquisition of the Stop Company to prepare the consolidation worksheet entries (such as consolidation entry S. A...) for December 31 of year two. $600,000 $50,000 $30,000 There was no impairment of any goodwill arising from the acquisition. Please indicate clearly which method (Equity, Partial Equity, or Initial Value) you choose for Proceed to use to account for its acquisition of Stop Company. $80,000 $40,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:100%
Proceed Company acquired
of the common stock of
Stop Company on January 1, year one, for
S600,000
On that date, Stop had the following trial balance:
debit
credit
$100,000
account
Additional paid in capital
Building (12-year life)
$250,000
Common stock
170,000
Current assets
180,000
160,000
110,000
Equipment (6-yr life)
Land
Liabilities (due in 4 years)
Retained earnings 1/year 1
310,000
120,000
mnect
Totals
$700,000 $700,000
During year one, Stop reported net income of
During year one, Stop paid dividends of
$50,000
$30,000
During year two, Stop reported net income of
During year two, Stop paid dividends of
$80,000
$40,000
On January 1, year one, fair values of some Stop's accounts were:
Land
Building
Equipment
$122,000
$262,000
$172,000
There was no impairment of any goodwill arising from the acquisition.
Please indicate clearly which method (Equity, Partial Equity, or Initial Value)
vou choose for Proceed to use to account for its acquisition of Stop Company.
Part A. Use the data for the Proceed Company acquisition of the Stop
Company to prepare the consolidation worksheet entries
(such as consolidation entry S, A,) for December 31 of year one.
Part B. Use the data for the Proceed Company acquisition of the Stop
Company to prepare the consolidation worksheet entries
(such as consolidation entry S, A. ) for December 31 of year two,
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