On January 1, 2016, Irbid Corporation acquired 90% of Jerash Company's voting stock, atunderlying book value. At that date, the fair value of Jerash's net asset was equal to book value.Irbid uses the equity method in accounting for its ownership of Jerash. On December 31, 2016,the trial balances of the two companies are as follows:Irbid Corp.Debit$ 225,500300,000144,00030,000180,00040,000Jerash Comp.Debit$145,000225,000CreditCreditCurrent assetsFixed assetsInvestment in Jerash co.Depreciation expenseOther expenseDividend25,00085,00010,000Accumulated depreciationCurrent liabilitiesLong-term debtCapital stockRetained earningssalesIncome from subsidiaryTotal$150,00045,00075,000100,000282,500253,50013,500$919,500$100,00020,00090,00075,00080,000125,000$919,500| $490,000$490,000Required:1. Provide all eliminating entries needed for consolidation as of December 31, 2016.2. Prepare a consolidation workpaper for Irbid and Jerash co. as of December 31,2016

Eliminating entries are prepared when the legally separated companies are actually a single holding…

Answered: Required: 1. Provide all eliminating…

Required: 1. Provide all eliminating entries needed for consolidation as of December 31, 2016. 2. Prepare a consolidation workpaper for Irbid and Jerash co. as of December 31, 2016

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Suspect Company issued $720,000 of 10 percent first mortgage bonds on January 1, 20X1, at 103. The…

A: Journal entries are the chronologically ordered written records of a company's financial activities.…

Q: Prepare the journal entries to record the assets acquired and liabilities assumed. Adjusted Fair…

A: Goodwill / (Gain on bargain purchase) on the business combination= Purchase consideration paid +…

Q: 48. Consolidation at the end of the first year subsequent to date of acquisition-Equity method…

Q: Assets Goodwill (Note 2) Buildings (Note 1) mventory Land Balance Sheet December 31, 2025 Accounts…

A: Balance sheet:The balance sheet is drafted by the company to show the balance of the trial balance…

Q: b. Prepare all consolidation entries needed to prepare consolidated statements for 20X5. Note: If no…

A: Accounting entries made to merge the parent company's financial data with those of its subsidiaries…

Q: On Jan 2, 2016. Parent sells to its wholly owned investee equipment that had cost $150,000. The…

A: Consolidation entry refers to the process of combining the financial statements of two or more…

Q: 1) Prepare the consolidated statement of financial position of Aubin Plc as at 30 September 2015.…

A: When a company (parent) holds a controlling interest (more than 50% of shareholding) in another…

Q: Peer Company acquired of the common stock of Sight Company on January 1, year one, for On that date,…

A: Consolidation is the process of integrating the financial accounts of a parent business and its…

Q: sale of depreciable assets Equity method Preparing the consolidation journal e Assume that on…

A: a. Particulars Amount ($) Amount ($) Depreciation (before transfer) Cost 156000 Less:…

Q: Sacred Heart Hospital had the following closing entries for the year ended December 31, 2017:…

A: A statement of operations is a fiscal statement businesses use to report earnings, cost of goods…

Q: On September 17, 2021 Ziltech inc entered into an agreement to sell one of its divisions that…

A: The assets are recognized as held for sale if it satisfies some conditions are as follows:…

Q: 4. Compute year 2 units-of-production depreciation expense for Machine B, assuming a capitalized…

A: Introduction: Depreciation is the reduction in the monetary worth of physical assets over time due…

Q: Assume that both the Parent and Subsidiary adopt 31 December as their financial year-end. Further…

A: Intragroup transactions are transactions that occur between entities in the group. They can be…

Q: Preparing the consolidation entries for sale of depreciable assets-Equity method Assume that on…

A: As per Bartleby guidelines if Multiple sub part questions are asked then expert needs to answer the…

Q: The comparative consolidated income statements of a parent and its 75%-owned subsidiary were…

A: To prepare the correct consolidated income statements for Year 5 and Year 6, we need to make the…

Q: The intangible assets section of Pronghorn Company at December 31, 2022, is presented here. Patents…

A: An asset with long-term financial value to a company is referred to as an intangible asset in…

Q: help please answer in text form with proper workings and explanation for each and every part and…

A: To prepare the consolidation worksheet adjusting entries for the sale of the non-current asset from…

Q: Check my work Chance Company had two operating divisions, one manufacturing farm equipment and the…

A: Earnings per share (EPS) is a financial ratio used to evaluate the profitability of a company on a…

Q: On January 1, 2021, Access IT Company exchanged $880,000 for 40 percent of the outstanding voting…

A: The term consolidate describes the process of combining two or more financial items like assets,…

Q: On December 31, 2023,

A: In financial accounting, discontinued operations refer to parts of a company's core business or…

Q: One year after acquisition date, the goodwill acquired was regarded as having become impaired by $80…

A: Introduction: Journals: Recording of a business transactions in a chronological order. First step in…

Q: Protec Company acquired 75% of Sussex Company's voting stock for $40,000 in cash. The noncontrolling…

A: In a consolidation process, when one company acquires a controlling interest in another company, the…

Q: Peanut Company acquired 90 percent of Snoopy Company's outstanding common stock for $279,000 on…

A: Equity method is used to report investment of a company in another company. It is used in both US.…

Q: Required information Problem 10-48 (LO 10-2) (Algo) [The following information applies to the…

A: For tax depreciation, (MACRS) approach is frequently employed. According to the half-year convention…

Q: Adjustment for Prepaid Expense The supplies account had a beginning balance of $3,375 and was…

A: At the point when you purchase supplies for your organization, you record the cost in your…

Q: Assume that both the Parent and Subsidiary adopt 31 December as their financial year-end. Further…

A: We’ll answer the first question since the exact one wasn’t specified. Please submit a new question…

Q: Pre-consolidation bookkeeping, downstream intercompany sales, profits in ending inventory-Equity…

A: A company can report the earnings it makes from its investment in another business using the equity…

Q: Review of pre-consolidation cost method (controlling investment in affiliate, fair value equals book…

A: Under the cost method, the investment is shown as a separate asset and the incomes received from the…

Q: The financial statements of Company Permanent and its subsidiary Company Senior are shown below.…

A: WN -1 Calculation of Net Identifiable Assets Particulars As on date of Acquisition…

Q: Required information Comprehensive Problem 02-76 (LO 02-1, LO 02-2, LO 02-3, LO 02-4, LO 02-5)…

A: Depreciation is an accounting technique for spreading out the expense of a tangible item over the…

Q: ould the consolidation entries in requirement (a) have differed if Gibson had sold a building on…

A: The process of integrating the financial results of numerous subsidiary firms into the parent…

Q: Sunland Company has a December 31 fiscal year end. Selected information follows for Sunland Company…

A: An instantly recognizable symbol, phrase, or word that designates a particular product is known as a…

Q: Impairment of Goodwill Instructions Chart of Accounts General Journal Instructions Next Level…

A: Impairment of goodwill When the carrying value of goodwill on financial statements exceeds its fair…

Q: Alomar Co., a consolidated enterprise, conducted an impairment review for each of its reporting…

A: Fair value of identifiable assets=Tangible assets+Intangible assets+Unrecognized intangible assets…

Q: Chance Company had two operating divisions, one manufacturing farm equipment and the other office…

A: The Parts of a company's activities that have been divested or shut down are referred to as…

Q: Assume that both the Parent and Subsidiary adopt 31 December as their financial year-end. Further…

A: SOLUTION- JOURNAL ENTRY IS THE COMPANY'S OFFICIAL BOOK IN WHICH ALL TRANSACTIONS ARE RECORDED IN…

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

On January 1, 2016, Irbid Corporation acquired 90% of Jerash Company's voting stock, at
underlying book value. At that date, the fair value of Jerash's net asset was equal to book value.
Irbid uses the equity method in accounting for its ownership of Jerash. On December 31, 2016,
the trial balances of the two companies are as follows:
Irbid Corp.
Debit
$ 225,500
300,000
144,000
30,000
180,000
40,000
Jerash Comp.
Debit
$145,000
225,000
Credit
Credit
Current assets
Fixed assets
Investment in Jerash co.
Depreciation expense
Other expense
Dividend
25,000
85,000
10,000
Accumulated depreciation
Current liabilities
Long-term debt
Capital stock
Retained earnings
sales
Income from subsidiary
Total
$150,000
45,000
75,000
100,000
282,500
253,500
13,500
$919,500
$100,000
20,000
90,000
75,000
80,000
125,000
$919,500
| $490,000
$490,000
Required:
1. Provide all eliminating entries needed for consolidation as of December 31, 2016.
2. Prepare a consolidation workpaper for Irbid and Jerash co. as of December 31,
2016

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step 3

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps with 2 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Plant & Company plans to convert to IFRSs with a date of transition to IFRSs of 1 January 2X22. Under previous GAAP certain non-derivative financial assets have been derecognized from the statement of financial position in 2x20. Such financial assets would not have been derecognized if IFRSs had been applied at the time that they were derecognized. Select the best response. Plant & Company must recognize non-derivative financial assets that have been derecognized in accordance with previous GAAP in the opening IFRS statement of financial position if they did not qualify for derecognition under IFRSs. Plant & Company must never recognize non-derivative financial assets that have been derecognized in accordance with previous GAAP. Plant & Company must not recognize non-derivative financial assets that have been derecognized in accordance with previous GAAP unless they qualify for recognition as a result of a later transaction or event. Plant & Company must determine if the non-derivative…
Do not give solution in images format
1.Please Complete Solution With Details 2.Final Answer Clearly Mentioned 3.Do not give solution in image format
The following relates to consolidation eliminating entries for 2020. Eliminating entry (R): Select one: A. Debits plant assets, net $5,000 B. Debits intangibles $8,000 C. Debits intangibles $9,000 D. Credits plant assets, net $4,000
Hh1.
Solve all questions Do not give answer in image
Preparing the consolidation entries for sale of land Assume that during 2015 a wholly owned subsidiary sells land that originally cost $450,000 to its parent for a sale price of $500,000. The parent holds the land until it sells the land to an unaffiliated company on December 31, 2019. The parent uses the equity method of pre-consolidation bookkeeping a. Prepare the required [] consolidation entry in 2015. Description gain Gain on a Cash b. Prepare the required [] consolidation entry required at the end of each year 2016 through 2018 Description Debit Credit gain Retained earnings Land gain Equityment Gain on sa Debit x 50,000 ✓ L c. Assume that the parent re-sells the land outside of the consolidated group for $525,000 on December 31, 2019. Prepare the journal entry made by the parent to record the sale and the required 3 consolidation entry for 2019. Description Credit 50,000 Debi 525,000 0✔ 0✔ Credit 25,000 0✔ 50,000 Dx DU 25,000x d. What will be the amount of gain reported in the…
Required information Comprehensive Problem 02-76 (LO 02-1, LO 02-2, LO 02-3, LO 02-4, LO 02-5) (Algo) [The following information applies to the questions displayed below.] Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in 2020. In the process of setting up the business, Karane has acquired various types of assets. Below is a list of assets acquired during 2020: Date Placed in Service 02/03/2020 07/22/2020 Asset Сost $ 180, 000 Office furniture Machinery Used delivery truck* *Not considered a luxury automobile. 1, 566, 000 46, 000 08/17/2020 During 2020, Karane was very successful (and had no $179 limitations) and decided to acquire more assets in 2021 to increase its production capacity. These are the assets acquired during 2021: Date Placed in Service Cost $ 406, 000 Asset Computers and information system Luxury autot Assembly equipment Storage building 03/31/2021 05/26/2021 08/15/2021 81, 500 1, 230, 000 700, 000 11/13/2021 tUsed 100%…
Please help me
answer in text form please (without image), Note: .Every entry should have narration please