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Smith, Incorporated, has the following stockholders' equity accounts as of January 1, 2024: Preferred stock-$100 par, nonvoting and nonparticipating, 8% cumulative dividend Common stock-$20 par value Retained earnings $ 2,200,000 4,200,000 10,200,000 Haried Company purchases all of Smith's common stock on January 1, 2024, for $14,430,000. The preferred stock remains in the hands of outside parties. Any excess acquisition-date fair value will be assigned to franchise contracts with a 30-year remaining life. Required: During 2024, Smith reports earning $650,000 in net income and declares $560,000 in cash dividends. Haried applies the equity method to this investment. a. What is the noncontrolling interest's share of consolidated net income for this period? b. What is the balance in the Investment in Smith account as of December 31, 2024? c. What consolidation entries are needed for 2024? Answer is not complete. Complete this question by entering your answers in the tabs below. Req A and B Req C What consolidation entries are needed for 2024? Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. No Transaction Accounts 1 S and A Common stock (Smith) Retained earnings (Smith) Amortization expense Debit 4,200,000 10,200,000 1,000 × Credit

Smith, Incorporated, has the following stockholders' equity accounts as of January 1, 2024: Preferred stock-$100 par, nonvoting and nonparticipating, 8% cumulative dividend Common stock-$20 par value Retained earnings $ 2,200,000 4,200,000 10,200,000 Haried Company purchases all of Smith's common stock on January 1, 2024, for $14,430,000. The preferred stock remains in the hands of outside parties. Any excess acquisition-date fair value will be assigned to franchise contracts with a 30-year remaining life. Required: During 2024, Smith reports earning $650,000 in net income and declares $560,000 in cash dividends. Haried applies the equity method to this investment. a. What is the noncontrolling interest's share of consolidated net income for this period? b. What is the balance in the Investment in Smith account as of December 31, 2024? c. What consolidation entries are needed for 2024? Answer is not complete. Complete this question by entering your answers in the tabs below. Req A and B Req C What consolidation entries are needed for 2024? Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. No Transaction Accounts 1 S and A Common stock (Smith) Retained earnings (Smith) Amortization expense Debit 4,200,000 10,200,000 1,000 × Credit

Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter16: Retained Earnings And Earnings Per Share
Section: Chapter Questions
Problem 11P: Raun Company had the following equity items as of December 31, 2019: Preferred stock, 9% cumulative,...
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Smith, Incorporated, has the following stockholders' equity accounts as of January 1, 2024: Preferred stock-$100 par, nonvoting and nonparticipating, 8% cumulative dividend Common stock-$20 par value Retained earnings $ 2,200,000 4,200,000 10,200,000 Haried Company purchases all of Smith's common stock on January 1, 2024, for $14,430,000. The preferred stock remains in the hands of outside parties. Any excess acquisition-date fair value will be assigned to franchise contracts with a 30-year remaining life. Required: During 2024, Smith reports earning $650,000 in net income and declares $560,000 in cash dividends. Haried applies the equity method to this investment. a. What is the noncontrolling interest's share of consolidated net income for this period? b. What is the balance in the Investment in Smith account as of December 31, 2024? c. What consolidation entries are needed for 2024? Answer is not complete. Complete this question by entering your answers in the tabs below. Req A and B Req C What consolidation entries are needed for 2024? Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. No Transaction Accounts 1 S and A Common stock (Smith) Retained earnings (Smith) Amortization expense Debit 4,200,000 10,200,000 1,000 × Credit
Transcribed Image Text:Smith, Incorporated, has the following stockholders' equity accounts as of January 1, 2024: Preferred stock-$100 par, nonvoting and nonparticipating, 8% cumulative dividend Common stock-$20 par value Retained earnings $ 2,200,000 4,200,000 10,200,000 Haried Company purchases all of Smith's common stock on January 1, 2024, for $14,430,000. The preferred stock remains in the hands of outside parties. Any excess acquisition-date fair value will be assigned to franchise contracts with a 30-year remaining life. Required: During 2024, Smith reports earning $650,000 in net income and declares $560,000 in cash dividends. Haried applies the equity method to this investment. a. What is the noncontrolling interest's share of consolidated net income for this period? b. What is the balance in the Investment in Smith account as of December 31, 2024? c. What consolidation entries are needed for 2024? Answer is not complete. Complete this question by entering your answers in the tabs below. Req A and B Req C What consolidation entries are needed for 2024? Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. No Transaction Accounts 1 S and A Common stock (Smith) Retained earnings (Smith) Amortization expense Debit 4,200,000 10,200,000 1,000 × Credit
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