3 Powder Company spent $240,000 to acquire all of Sawmill Corporation's stock on January 1, 20X2. On December 31, 20X4, the trialbalances of the two companies were as follows:ItemCashAccounts ReceivableLandBuildings and EquipmentInvestment in Sawmill CorporationCost of Services ProvidedDepreciation ExpenseOther ExpensesDividends DeclaredAccumulated DepreciationAccounts PayableTaxes PayableNotes PayableCommon StockRetained EarningsService RevenueIncome from Sawmill CorporationPowder CompanyDebit$ 74,000130,00060,000500,000268,000470,00035,00057,00030,000$ 1,624,000Credit$ 265,00071,00058,000100,000200,000292,000610,00028,000$ 1,624,000CreditSawmill CorporationDebit$ 42,00053,00050,000350,000130,00018,00060,00012,000$ 715,000$ 93,00017,00060,00085,000100,000120,000240,000$ 715,000Sawmill Corporation reported retained earnings of $100,000 at the date of acquisition. The difference between the acquisition priceand underlying book value is assigned to buildings and equipment with a remaining economic life of 10 years from the date ofacquisition. Sawmill's accumulated depreciation on the acquisition date was $25,000. At December 31, 20X4, Sawmill owed Powder$2,500.Required:Prepare all consolidation entries required on December 31, 20X4, to prepare consolidated financial statements.

Name: 3 Powder Company spent $240,000 to acquire all of Sawmill Corporation'
Uploaded: 2024-03-05T11:50:36.000Z
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Description: 3 Powder Company spent $240,000 to acquire all of Sawmill Corporation's stock on January 1, 20X2. On December 31, 20X4, the trialbalances of the two companies were as follows:ItemCashAccounts ReceivableLandBuildings and EquipmentInvestment in Sawmill

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Sawmill Corporation reported retained earnings of $100,000 at the date of acquisition. The difference between the acquisition price and underlying book value is assigned to buildings and equipment with a remaining economic life of 10 years from the date of acquisition. Sawmill's accumulated depreciation on the acquisition date was $25,000. At December 31, 20X4, Sawmill owed Powder $2,500. Required: Prepare all consolidation entries required on December 31, 20X4, to prepare consolidated financial statements.