Chapter 4, Problem 50P

a.

To determine

Prepare the journal entries made by the subsidiary to record the sale of the equipment to the parent; and by the parent to record the purchase and the [I] entries for the year of sale.

b.

To determine

Compute the remaining portion of the deferred gain on January 1, 2019.

c.

To determine

Exhibit the calculation to yield the income (loss) from subsidiary reported by the parent company for the year ended Dec 31, 2019.

d.

To determine

Compute the equity investment account balance on Dec 31, 2019.

e.

To determine

Prepare the consolidation entries for the year ended Dec 31, 2019.

f.

To determine

Prepare the consolidation spreadsheet for the year ended December 31, 2019.