Required a. What amount of depreciation expense on the building will Pea report for 20X9? Annual depreciation expense reported by Pea b. What amount of depreciation expense would Split have reported for 20X9 if it had continued to own the building? Annual depreciation expense reported by Split Pea Company purchased 70 percent of Split Company's stock approximately 20 years ago. On December 31, 20X8, Pea purchas building from Split for $372,000. Split had purchased the building on January 1, 20X1, at a cost of $472,000 and used straight-line depreciation on an expected life of 20 years. The asset's total estimated economic life is unchanged as a result of the intercompa sale. No A c. Prepare the consolidation entry or entries needed to eliminate the effects of the intercompany building transfer in preparing set of consolidated financial statements at December 31, 20X9. (If no entry is required for a transaction/event, select "No jour entry required" in the first account field.) B $ 31,000 Event 1 2 $ 23,600 Investment in Split Company NCI in NA of Split Company Building Accumulated depreciation Accumulated depreciation Depreciation expense Income assigned to noncontrolling interest Answer is not complete. Answer is not complete. Accounts 0000 ♥ ›› ✔ Debit 100,000✔ 7,400 Credit d. What amount of income will be assigned to the noncontrolling interest in the consolidated income statement for 20X9 if Split report net income of $25,000 for 20X9? 7,400✔ e. Split reports assets with a book value of $320,000 and liabilities of $130,000 at January 1, 20X9, and reports net income of $25,000 and dividends of $10,000 for 20X9. What amount will be assigned to the noncontrolling interest in the consolidated balance sheet at December 31, 20X9, assuming the fair value of the noncontrolling interest at the date of acquisition was equal to 30 percent of Split Company's book value?
Required a. What amount of depreciation expense on the building will Pea report for 20X9? Annual depreciation expense reported by Pea b. What amount of depreciation expense would Split have reported for 20X9 if it had continued to own the building? Annual depreciation expense reported by Split Pea Company purchased 70 percent of Split Company's stock approximately 20 years ago. On December 31, 20X8, Pea purchas building from Split for $372,000. Split had purchased the building on January 1, 20X1, at a cost of $472,000 and used straight-line depreciation on an expected life of 20 years. The asset's total estimated economic life is unchanged as a result of the intercompa sale. No A c. Prepare the consolidation entry or entries needed to eliminate the effects of the intercompany building transfer in preparing set of consolidated financial statements at December 31, 20X9. (If no entry is required for a transaction/event, select "No jour entry required" in the first account field.) B $ 31,000 Event 1 2 $ 23,600 Investment in Split Company NCI in NA of Split Company Building Accumulated depreciation Accumulated depreciation Depreciation expense Income assigned to noncontrolling interest Answer is not complete. Answer is not complete. Accounts 0000 ♥ ›› ✔ Debit 100,000✔ 7,400 Credit d. What amount of income will be assigned to the noncontrolling interest in the consolidated income statement for 20X9 if Split report net income of $25,000 for 20X9? 7,400✔ e. Split reports assets with a book value of $320,000 and liabilities of $130,000 at January 1, 20X9, and reports net income of $25,000 and dividends of $10,000 for 20X9. What amount will be assigned to the noncontrolling interest in the consolidated balance sheet at December 31, 20X9, assuming the fair value of the noncontrolling interest at the date of acquisition was equal to 30 percent of Split Company's book value?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Transcribed Image Text:Pea Company purchased 70 percent of Split Company's stock approximately 20 years ago. On December 31, 20X8, Pea purchased a
building from Split for $372,000. Split had purchased the building on January 1, 20X1, at a cost of $472,000 and used straight-line
depreciation on an expected life of 20 years. The asset's total estimated economic life is unchanged as a result of the intercompany
sale.
Required
a. What amount of depreciation expense on the building will Pea report for 20X9?
Annual depreciation expense reported by Pea
Annual depreciation expense reported by Split
b. What amount of depreciation expense would Split have reported for 20X9 if it had continued to own the building?
No
A
Pea Company purchased 70 percent of Split Company's stock approximately 20 years ago. On December 31, 20X8, Pea purchased a
building from Split for $372,000. Split had purchased the building on January 1, 20X1, at a cost of $472,000 and used straight-line
depreciation on an expected life of 20 years. The asset's total estimated economic life is unchanged as a result of the intercompany
sale.
B
c. Prepare the consolidation entry or entries needed to eliminate the effects of the intercompany building transfer in preparing a full
set of consolidated financial statements at December 31, 20X9. (If no entry is required for a transaction/event, select "No journal
entry required" in the first account field.)
Event
1
$
2
Investment in Split Company
NCI in NA of Split Company
Building
Accumulated depreciation
Accumulated depreciation
Depreciation expense
31,000
Answer is not complete.
Income assigned to noncontrolling interest
23,600
Amount assigned to noncontrolling interest
Answer is not complete.
Accounts
› › ››
♥
✓
✔
Debit
100,000✔
7,400✔
d. What amount of income will be assigned to the noncontrolling interest in the consolidated income statement for 20X9 if Split reports
net income of $25,000 for 20X9?
Credit
7,400✔
e. Split reports assets with a book value of $320,000 and liabilities of $130,000 at January 1, 20X9, and reports net income of $25,000
and dividends of $10,000 for 20X9. What amount will be assigned to the noncontrolling interest in the consolidated balance sheet at
December 31, 20X9, assuming the fair value of the noncontrolling interest at the date of acquisition was equal to 30 percent of Split
Company's book value?
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