FINANCIAL AND MANAGERIAL ACCOUNTING
FINANCIAL AND MANAGERIAL ACCOUNTING
9th Edition
ISBN: 9781265325947
Author: Wild
Publisher: MCG
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Chapter 11, Problem 9QS
To determine

Concept Introduction:

Stock dividends are a distribution of additional shares of its own common stock without any payment. A stock dividend does not reduce assets and equity but instead transfers a portion of equity from retained earnings to contributed capital. Stock dividends are declared to keep the market price of the share affordable, and declare of stock dividends also shows management confidence in the company.

The journal entry for declaration of stock dividends.

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Consolidation after Several Years  On January 1, 2016, Adams Corporation acquired all of the stock of Baker Company. The fair value of Adams’ shares used in the exchange was $37,500,000. At the time of acquisition, the book value of Baker’s shareholders’ equity was $5,000,000, and the book value of Baker’s building (25-year life) exceeded its fair value by $1,000,000. From the date of acquisition to December 31, 2021, Baker had cumulative net income of $1,300,000. For 2022, Baker reported net income of $300,000. Adams uses the complete equity method to account for its investment in Baker. There is no goodwill impairment loss for the period 2016 through 2021, but there is impairment loss of $100,000 in 2022. Baker declared no dividends during the period 2016–2022.  Required  Prepare the working paper eliminating entries necessary to consolidate the financial statements of Adams and Baker at December 31, 2022. Enter numerical answers using all zeros (do not abbreviate in thousands or in…
Give me the answer in a clear organized table please. Thank you!

Chapter 11 Solutions

FINANCIAL AND MANAGERIAL ACCOUNTING

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