The following are selected accounts and balances for Mergaronite Company and H, Inc, as of December 31, 2021 Several of Mergaronite's accounts have been omitted Credit balances are indicated by parentheses. Dividends were declared and paid in the same period Hergaronite $(620,000) S (20,000) 276, 102.000 HELL Bevenues Cast f gode sold Depreciation espense Envestent incoe Retalned ernings, 1/1/21 Divldends declared Current assets 106,00 46,000 NA (912, 000) 124,000 210, 00 (S0, 00) 44,0e Land ildings (net) tquipnent (et) 488,00 196,000 8,000 10,000 252,000 Liahtlities Common atock Adtimal pal4-in capital (282,e) (58,000) (42,000) (924, 000) Assume that Mergaronite acquired Hill on Januaryt. 2017, by issuing 6.200 shares of common stock having a par value of $10 per share but a fair value of $100 each. On January 1, 2017, Hill's land was undervalued by S18.200, its buildings were overvalued by $28.000, and equipment was undervalued by $58,800. The buildings had a 10-year remaining life, the equipment had a 5-year remaining life. A customer ist with an appraised value of $108,000 was developed internaly by Hill and was estimated to have a 20- year remaining useful life a. Determine the December 31, 2021, consolidated totals for the following accounts b. In requirement (a). can the consolidated totals be determined without knowing which method the parent used to account for the subsidiary? Cthe parent uses the equity method, what consolidation entries would be used on a 2021 worksheet?
The following are selected accounts and balances for Mergaronite Company and H, Inc, as of December 31, 2021 Several of Mergaronite's accounts have been omitted Credit balances are indicated by parentheses. Dividends were declared and paid in the same period Hergaronite $(620,000) S (20,000) 276, 102.000 HELL Bevenues Cast f gode sold Depreciation espense Envestent incoe Retalned ernings, 1/1/21 Divldends declared Current assets 106,00 46,000 NA (912, 000) 124,000 210, 00 (S0, 00) 44,0e Land ildings (net) tquipnent (et) 488,00 196,000 8,000 10,000 252,000 Liahtlities Common atock Adtimal pal4-in capital (282,e) (58,000) (42,000) (924, 000) Assume that Mergaronite acquired Hill on Januaryt. 2017, by issuing 6.200 shares of common stock having a par value of $10 per share but a fair value of $100 each. On January 1, 2017, Hill's land was undervalued by S18.200, its buildings were overvalued by $28.000, and equipment was undervalued by $58,800. The buildings had a 10-year remaining life, the equipment had a 5-year remaining life. A customer ist with an appraised value of $108,000 was developed internaly by Hill and was estimated to have a 20- year remaining useful life a. Determine the December 31, 2021, consolidated totals for the following accounts b. In requirement (a). can the consolidated totals be determined without knowing which method the parent used to account for the subsidiary? Cthe parent uses the equity method, what consolidation entries would be used on a 2021 worksheet?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:The following are selected accounts and balances for Mergaronite Company and H, Inc as of December 31, 2021. Several of
Mergaronite's accounts have been omitted. Credit balances are indicated by parentheses. Dividends were declared and paid in the
same period
Revenues
Cast f gode sold
Depreciation espense
Investent incone
Retalned arnings, 1/1/21
Dividends declared
Current assets
Land
tuildings (art)
Equipment (net)
Llahitities
ergaronite
$(620,000) S (260,000
276,
102,000
NA
(912,000)
124,000
210,000
30,000
488,000
196,000
(406,000)
(282,000)
(58,000)
10,000
46,000
NA
(s,000)
44,000
666,000
130,000
252.000
(302, 000)
(42, 000)
(924,000)
Common stock
Aditiomal pald-in capital
Assume that Mergaronite acquired Hill on January 1, 2017, by issuing 6,200 shares of common stock having a par value of $10 per
share but a fair value of $100 each On January 1, 2017, Hill's land was undervalued by S18,200, its buildings were overvalued by
$28.000, and equipment was undervalued by $58,800. The buildings had a 10-year remaining life, the equipment had a 5-year
remaining lide. A customer list with an appraised value of $108,000 was developed internaly by Hill and was estimated to have a 20-
year remaining useful life
a. Determine the December 31, 2021, consolidated totals for the following accounts
b. In requirement (a), can the consolidated totals be determined without knowing which method the parent used to account for the
subsidiary?
C.If the parent uses the equity method, what consolidation entries would be used on a 2021 worksheet?
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!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
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.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education