Please Show All Calculation And do not Give Solution in images format town Corporation purchased 75 percent of Sandbox Company common stock and 40 percent of itspreferred stock on January 1, 20X6, for $270,000 and $80,000, respectively. At the time of purchase, thefair value of Sandbox's common shares held by the noncontrolling interest was $90,000. Sandbox'sbalance sheet contained the following balances:Preferred Stock ($10 par value)$ 200,000Common Stock ($5 par value)150,000Retained Earnings210,000Total Stockholders' Equity$ 560,000For the year ended December 31, 20X6, Sandbox reported net income of $70,000 and paid dividends of$50,000 (which includes the preferred dividend). The preferred stock is cumulative and pays an annualdividend of 8 percent.Required:Prepare the journal entries recorded by Playtown for its investments in Sandbox during 20X6.A. Record the purchase of Sandbox stock.B. Record the dividends from Sandbox.C. Record the dividends on the preferred stock from Sandbox.D. Record the equity-method income.

Consolidation is the process of merging the financial statements of parent and subsidiary to show…

town Corporation purchased 75 percent of Sandbox Company common stock and 40 percent of its preferred stock on January 1, 20X6, for $270,000 and $80,000, respectively. At the time of purchase, the fair value of Sandbox's common shares held by the noncontrolling interest was $90,000. Sandbox's balance sheet contained the following balances: $ 200,000 Preferred Stock ($10 par value) Common Stock ($5 par value) Retained Earnings Total Stockholders' Equity 150,000 210,000 $ 560,000

town Corporation purchased 75 percent of Sandbox Company common stock and 40 percent of its preferred stock on January 1, 20X6, for $270,000 and $80,000, respectively. At the time of purchase, the fair value of Sandbox's common shares held by the noncontrolling interest was $90,000. Sandbox's balance sheet contained the following balances: $ 200,000 Preferred Stock ($10 par value) Common Stock ($5 par value) Retained Earnings Total Stockholders' Equity 150,000 210,000 $ 560,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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