The consolidated balance sheet and the worksheets are the computed tools that are used to calculate the retained earnings and the dividend produced by the subsidiaries towards its parent company. To prepare: A journal entry by equity method for the investment in scissor company in the year 2009 .

Question

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Answer 1

Question

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 3, Problem 3.31P

a.

To determine

Introduction:The consolidated balance sheet and the worksheets are the computed tools that are used to calculate the retained earnings and the dividend produced by the subsidiaries towards its parent company.

To prepare: A journal entry by equity method for the investment in scissor company in the year 2009 .

a.

Expert Solution

Explanation of Solution

Particulars	Amount ($)	Amount ($)
Equity method entry on books
Investment in SCo. Dr.	85,600
Income from SCo. Cr.		85,600
(To record P co. 80% share of the S co. 2009 income)

Cash Dr.	24,000
Investment in the SCo. Cr.		24,000
(To record PCo. share in S Co. dividend)

b.

To determine

Introduction:The consolidated balance sheet and the worksheets are the computed tools that are used to calculate the retained earnings and the dividend produced by the subsidiaries towards its parent company.

To prepare:The consolidated worksheet for the final values

b.

Expert Solution

Explanation of Solution

Book value calculation
	NCI 20%	+	P co.	=	Common stock	+	Retained earnings
Book value	87,600		350,400		250,000		188,000
Net income	21,400		85,600				107,000
Dividend	6000		24,000				30,000
Ending book value	103,000		412,000		250,000		265,000

Income statement	P co.	S co.	Eliminated Dr	Eliminated Cr.	Consolidated
Cash	295,000	116,000			411,000
Accounts received	165,000	97,000			262,000
Inventory	193,000	115,000			308,000
Investment in SCo.	412,000			412,000	0
Land	250,000	125,000			375,000
Building and equipment	875,000	250,000		24,000	1,101,000
Less accumulated depreciation	630,000	48,000	24,000		654,000
Total assets	1,560,000	655,000	24,000	436,000	1,803,000
Account payable	85,000	40,000			125,000
Bonds	150,000	100,000			250,000
Common stocks	625,000	250,000	250,000		625,000
Retained earnings	700,000	265,000	295,000	30,000	700,000
NCI in NA in SCo.				103,000	103,000
Total liabilities	1,560,000	655,000	545,000	133,000	1,803,000

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Answer 2

Question

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 3, Problem 3.31P

a.

To determine

Introduction:The consolidated balance sheet and the worksheets are the computed tools that are used to calculate the retained earnings and the dividend produced by the subsidiaries towards its parent company.

To prepare: A journal entry by equity method for the investment in scissor company in the year 2009 .

a.

Expert Solution

Explanation of Solution

Particulars	Amount ($)	Amount ($)
Equity method entry on books
Investment in SCo. Dr.	85,600
Income from SCo. Cr.		85,600
(To record P co. 80% share of the S co. 2009 income)

Cash Dr.	24,000
Investment in the SCo. Cr.		24,000
(To record PCo. share in S Co. dividend)

b.

To determine

Introduction:The consolidated balance sheet and the worksheets are the computed tools that are used to calculate the retained earnings and the dividend produced by the subsidiaries towards its parent company.

To prepare:The consolidated worksheet for the final values

b.

Expert Solution

Explanation of Solution

Book value calculation
	NCI 20%	+	P co.	=	Common stock	+	Retained earnings
Book value	87,600		350,400		250,000		188,000
Net income	21,400		85,600				107,000
Dividend	6000		24,000				30,000
Ending book value	103,000		412,000		250,000		265,000

Income statement	P co.	S co.	Eliminated Dr	Eliminated Cr.	Consolidated
Cash	295,000	116,000			411,000
Accounts received	165,000	97,000			262,000
Inventory	193,000	115,000			308,000
Investment in SCo.	412,000			412,000	0
Land	250,000	125,000			375,000
Building and equipment	875,000	250,000		24,000	1,101,000
Less accumulated depreciation	630,000	48,000	24,000		654,000
Total assets	1,560,000	655,000	24,000	436,000	1,803,000
Account payable	85,000	40,000			125,000
Bonds	150,000	100,000			250,000
Common stocks	625,000	250,000	250,000		625,000
Retained earnings	700,000	265,000	295,000	30,000	700,000
NCI in NA in SCo.				103,000	103,000
Total liabilities	1,560,000	655,000	545,000	133,000	1,803,000

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Answer 3

Question

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 3, Problem 3.31P

a.

To determine

Introduction:The consolidated balance sheet and the worksheets are the computed tools that are used to calculate the retained earnings and the dividend produced by the subsidiaries towards its parent company.

To prepare: A journal entry by equity method for the investment in scissor company in the year 2009 .

a.

Expert Solution

Explanation of Solution

Particulars	Amount ($)	Amount ($)
Equity method entry on books
Investment in SCo. Dr.	85,600
Income from SCo. Cr.		85,600
(To record P co. 80% share of the S co. 2009 income)

Cash Dr.	24,000
Investment in the SCo. Cr.		24,000
(To record PCo. share in S Co. dividend)

b.

To determine

Introduction:The consolidated balance sheet and the worksheets are the computed tools that are used to calculate the retained earnings and the dividend produced by the subsidiaries towards its parent company.

To prepare:The consolidated worksheet for the final values

b.

Expert Solution

Explanation of Solution

Book value calculation
	NCI 20%	+	P co.	=	Common stock	+	Retained earnings
Book value	87,600		350,400		250,000		188,000
Net income	21,400		85,600				107,000
Dividend	6000		24,000				30,000
Ending book value	103,000		412,000		250,000		265,000

Income statement	P co.	S co.	Eliminated Dr	Eliminated Cr.	Consolidated
Cash	295,000	116,000			411,000
Accounts received	165,000	97,000			262,000
Inventory	193,000	115,000			308,000
Investment in SCo.	412,000			412,000	0
Land	250,000	125,000			375,000
Building and equipment	875,000	250,000		24,000	1,101,000
Less accumulated depreciation	630,000	48,000	24,000		654,000
Total assets	1,560,000	655,000	24,000	436,000	1,803,000
Account payable	85,000	40,000			125,000
Bonds	150,000	100,000			250,000
Common stocks	625,000	250,000	250,000		625,000
Retained earnings	700,000	265,000	295,000	30,000	700,000
NCI in NA in SCo.				103,000	103,000
Total liabilities	1,560,000	655,000	545,000	133,000	1,803,000

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Answer 4

Question

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 3, Problem 3.31P

a.

To determine

Introduction:The consolidated balance sheet and the worksheets are the computed tools that are used to calculate the retained earnings and the dividend produced by the subsidiaries towards its parent company.

To prepare: A journal entry by equity method for the investment in scissor company in the year 2009 .

a.

Expert Solution

Explanation of Solution

Particulars	Amount ($)	Amount ($)
Equity method entry on books
Investment in SCo. Dr.	85,600
Income from SCo. Cr.		85,600
(To record P co. 80% share of the S co. 2009 income)

Cash Dr.	24,000
Investment in the SCo. Cr.		24,000
(To record PCo. share in S Co. dividend)

b.

To determine

Introduction:The consolidated balance sheet and the worksheets are the computed tools that are used to calculate the retained earnings and the dividend produced by the subsidiaries towards its parent company.

To prepare:The consolidated worksheet for the final values

b.

Expert Solution

Explanation of Solution

Book value calculation
	NCI 20%	+	P co.	=	Common stock	+	Retained earnings
Book value	87,600		350,400		250,000		188,000
Net income	21,400		85,600				107,000
Dividend	6000		24,000				30,000
Ending book value	103,000		412,000		250,000		265,000

Income statement	P co.	S co.	Eliminated Dr	Eliminated Cr.	Consolidated
Cash	295,000	116,000			411,000
Accounts received	165,000	97,000			262,000
Inventory	193,000	115,000			308,000
Investment in SCo.	412,000			412,000	0
Land	250,000	125,000			375,000
Building and equipment	875,000	250,000		24,000	1,101,000
Less accumulated depreciation	630,000	48,000	24,000		654,000
Total assets	1,560,000	655,000	24,000	436,000	1,803,000
Account payable	85,000	40,000			125,000
Bonds	150,000	100,000			250,000
Common stocks	625,000	250,000	250,000		625,000
Retained earnings	700,000	265,000	295,000	30,000	700,000
NCI in NA in SCo.				103,000	103,000
Total liabilities	1,560,000	655,000	545,000	133,000	1,803,000

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Answer 5

Chapter 3, Problem 3.31P

a.

To determine

Introduction:The consolidated balance sheet and the worksheets are the computed tools that are used to calculate the retained earnings and the dividend produced by the subsidiaries towards its parent company.

To prepare: A journal entry by equity method for the investment in scissor company in the year 2009 .

a.

Expert Solution

Explanation of Solution

Particulars	Amount ($)	Amount ($)
Equity method entry on books
Investment in SCo. Dr.	85,600
Income from SCo. Cr.		85,600
(To record P co. 80% share of the S co. 2009 income)

Cash Dr.	24,000
Investment in the SCo. Cr.		24,000
(To record PCo. share in S Co. dividend)

b.

To determine

Introduction:The consolidated balance sheet and the worksheets are the computed tools that are used to calculate the retained earnings and the dividend produced by the subsidiaries towards its parent company.

To prepare:The consolidated worksheet for the final values

b.

Expert Solution

Explanation of Solution

Book value calculation
	NCI 20%	+	P co.	=	Common stock	+	Retained earnings
Book value	87,600		350,400		250,000		188,000
Net income	21,400		85,600				107,000
Dividend	6000		24,000				30,000
Ending book value	103,000		412,000		250,000		265,000

Income statement	P co.	S co.	Eliminated Dr	Eliminated Cr.	Consolidated
Cash	295,000	116,000			411,000
Accounts received	165,000	97,000			262,000
Inventory	193,000	115,000			308,000
Investment in SCo.	412,000			412,000	0
Land	250,000	125,000			375,000
Building and equipment	875,000	250,000		24,000	1,101,000
Less accumulated depreciation	630,000	48,000	24,000		654,000
Total assets	1,560,000	655,000	24,000	436,000	1,803,000
Account payable	85,000	40,000			125,000
Bonds	150,000	100,000			250,000
Common stocks	625,000	250,000	250,000		625,000
Retained earnings	700,000	265,000	295,000	30,000	700,000
NCI in NA in SCo.				103,000	103,000
Total liabilities	1,560,000	655,000	545,000	133,000	1,803,000

Answer 6

Chapter 3, Problem 3.31P

a.

To determine

Introduction:The consolidated balance sheet and the worksheets are the computed tools that are used to calculate the retained earnings and the dividend produced by the subsidiaries towards its parent company.

To prepare: A journal entry by equity method for the investment in scissor company in the year 2009 .

a.

Expert Solution

Explanation of Solution

Particulars	Amount ($)	Amount ($)
Equity method entry on books
Investment in SCo. Dr.	85,600
Income from SCo. Cr.		85,600
(To record P co. 80% share of the S co. 2009 income)

Cash Dr.	24,000
Investment in the SCo. Cr.		24,000
(To record PCo. share in S Co. dividend)

Answer 7

Chapter 3, Problem 3.31P

a.

To determine

Introduction:The consolidated balance sheet and the worksheets are the computed tools that are used to calculate the retained earnings and the dividend produced by the subsidiaries towards its parent company.

To prepare: A journal entry by equity method for the investment in scissor company in the year 2009 .

Answer 8

a.

Expert Solution

Explanation of Solution

Particulars	Amount ($)	Amount ($)
Equity method entry on books
Investment in SCo. Dr.	85,600
Income from SCo. Cr.		85,600
(To record P co. 80% share of the S co. 2009 income)

Cash Dr.	24,000
Investment in the SCo. Cr.		24,000
(To record PCo. share in S Co. dividend)

Answer 9

a.

Expert Solution

Answer 10

a.

Expert Solution

Answer 11

Expert Solution

Answer 12

b.

To determine

Introduction:The consolidated balance sheet and the worksheets are the computed tools that are used to calculate the retained earnings and the dividend produced by the subsidiaries towards its parent company.

To prepare:The consolidated worksheet for the final values

b.

Expert Solution

Explanation of Solution

Book value calculation
	NCI 20%	+	P co.	=	Common stock	+	Retained earnings
Book value	87,600		350,400		250,000		188,000
Net income	21,400		85,600				107,000
Dividend	6000		24,000				30,000
Ending book value	103,000		412,000		250,000		265,000

Income statement	P co.	S co.	Eliminated Dr	Eliminated Cr.	Consolidated
Cash	295,000	116,000			411,000
Accounts received	165,000	97,000			262,000
Inventory	193,000	115,000			308,000
Investment in SCo.	412,000			412,000	0
Land	250,000	125,000			375,000
Building and equipment	875,000	250,000		24,000	1,101,000
Less accumulated depreciation	630,000	48,000	24,000		654,000
Total assets	1,560,000	655,000	24,000	436,000	1,803,000
Account payable	85,000	40,000			125,000
Bonds	150,000	100,000			250,000
Common stocks	625,000	250,000	250,000		625,000
Retained earnings	700,000	265,000	295,000	30,000	700,000
NCI in NA in SCo.				103,000	103,000
Total liabilities	1,560,000	655,000	545,000	133,000	1,803,000

Answer 13

b.

To determine

Introduction:The consolidated balance sheet and the worksheets are the computed tools that are used to calculate the retained earnings and the dividend produced by the subsidiaries towards its parent company.

To prepare:The consolidated worksheet for the final values

Answer 14

b.

Expert Solution

Explanation of Solution

Book value calculation
	NCI 20%	+	P co.	=	Common stock	+	Retained earnings
Book value	87,600		350,400		250,000		188,000
Net income	21,400		85,600				107,000
Dividend	6000		24,000				30,000
Ending book value	103,000		412,000		250,000		265,000

Income statement	P co.	S co.	Eliminated Dr	Eliminated Cr.	Consolidated
Cash	295,000	116,000			411,000
Accounts received	165,000	97,000			262,000
Inventory	193,000	115,000			308,000
Investment in SCo.	412,000			412,000	0
Land	250,000	125,000			375,000
Building and equipment	875,000	250,000		24,000	1,101,000
Less accumulated depreciation	630,000	48,000	24,000		654,000
Total assets	1,560,000	655,000	24,000	436,000	1,803,000
Account payable	85,000	40,000			125,000
Bonds	150,000	100,000			250,000
Common stocks	625,000	250,000	250,000		625,000
Retained earnings	700,000	265,000	295,000	30,000	700,000
NCI in NA in SCo.				103,000	103,000
Total liabilities	1,560,000	655,000	545,000	133,000	1,803,000

Answer 15

b.

Expert Solution

Answer 16

b.

Expert Solution

Answer 17

Expert Solution

Answer 18

Ch. 3 - What is the basic idea underlying the preparation...Ch. 3 - How might consolidated statements help an investor...Ch. 3 - Prob. 3.3Q Ch. 3 - Prob. 3.4Q Ch. 3 - Prob. 3.5Q Ch. 3 - Prob. 3.6Q Ch. 3 - Prob. 3.7Q Ch. 3 - Prob. 3.8Q Ch. 3 - Prob. 3.9Q Ch. 3 - Prob. 3.10Q

The consolidated balance sheet and the worksheets are the computed tools that are used to calculate the retained earnings and the dividend produced by the subsidiaries towards its parent company. To prepare: A journal entry by equity method for the investment in scissor company in the year 2009 .

Concept explainers

Explanation of Solution

Introduction:The consolidated balance sheet and the worksheets are the computed tools that are used to calculate the retained earnings and the dividend produced by the subsidiaries towards its parent company.

To prepare:The consolidated worksheet for the final values

Explanation of Solution

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Chapter 3 Solutions

The consolidated balance sheet and the worksheets are the computed tools that are used to calculate the retained earnings and the dividend produced by the subsidiaries towards its parent company. To prepare: A journal entry by equity method for the investment in scissor company in the year 2009 .

Concept explainers

Explanation of Solution

Introduction:The consolidated balance sheet and the worksheets are the computed tools that are used to calculate the retained earnings and the dividend produced by the subsidiaries towards its parent company. To prepare:The consolidated worksheet for the final values

Explanation of Solution

Want to see more full solutions like this?

Chapter 3 Solutions

Introduction:The consolidated balance sheet and the worksheets are the computed tools that are used to calculate the retained earnings and the dividend produced by the subsidiaries towards its parent company.

To prepare:The consolidated worksheet for the final values