Required: a.Compute the equity method balance in QuickPort's Investment in NetSpeed, Incorporated, account as of December 31, 2024 b. Prepere the worksheet adjustments for the December 31, 2024, consolidation of QuickPort and NetSpeed

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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On January 1, 2023, QuickPort Company acquired 90 percent of the outstanding voting stock of NetSpeed, Incorporated, for $810,000
in cash and stock options. At the acquisition date. NetSpeed had common stock of $800,000 and Retained Earnings of $40,000. The
acquisition-dete fair value of the 10 percent noncontrolling interest was $90.000. QuickPort attributed the $60.000 excess of
NetSpeed's fair value over book value to a database with a five-year remaining life
During the next two years, NetSpeed reported the following
Income
8,000
Dividends
Declared
On July 1, 2023, QuickPort sold communication equipment to NetSpeed for $42.000. The equipment originally cost $48,000 and had
accumulated depreciation of $9,000 and an estimated remaining life of three years at the date of the intra-entity transfer
Required:
Compute the equity method balance in QuickPort's Investment in NetSpeed, incorporated, account as of December 31, 2024.
b. Prepere the worksheet adjustments for the December 31, 2024, consolidation of QuickPort and NetSpeed
Compute the equity method balance in QuickPort's Investment in NetSpeed, Incorporated, account as of December 31, 2024.
Investment in NetSpeed, Incorporated, 12/31/24
1 Prepare entry "TA
2 Prepare entry S
Prepare entry A
4 Prepare entry I
5 Prepare entry D
6 Prepare entry E
7 Prepare entry ED
Transcribed Image Text:On January 1, 2023, QuickPort Company acquired 90 percent of the outstanding voting stock of NetSpeed, Incorporated, for $810,000 in cash and stock options. At the acquisition date. NetSpeed had common stock of $800,000 and Retained Earnings of $40,000. The acquisition-dete fair value of the 10 percent noncontrolling interest was $90.000. QuickPort attributed the $60.000 excess of NetSpeed's fair value over book value to a database with a five-year remaining life During the next two years, NetSpeed reported the following Income 8,000 Dividends Declared On July 1, 2023, QuickPort sold communication equipment to NetSpeed for $42.000. The equipment originally cost $48,000 and had accumulated depreciation of $9,000 and an estimated remaining life of three years at the date of the intra-entity transfer Required: Compute the equity method balance in QuickPort's Investment in NetSpeed, incorporated, account as of December 31, 2024. b. Prepere the worksheet adjustments for the December 31, 2024, consolidation of QuickPort and NetSpeed Compute the equity method balance in QuickPort's Investment in NetSpeed, Incorporated, account as of December 31, 2024. Investment in NetSpeed, Incorporated, 12/31/24 1 Prepare entry "TA 2 Prepare entry S Prepare entry A 4 Prepare entry I 5 Prepare entry D 6 Prepare entry E 7 Prepare entry ED
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