Journal entries are a systematic method of recording transactions as and when they occur. It is a summary of transactions divided into the debit and credit items that are recorded chronologically. It is an act of keeping and recording all the transactions occurring in the business. Consolidating entries to complete a consolidated worksheet for 20X8

Question

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Answer 1

Question

Chapter 6, Problem 6.22P

a.

To determine

Introduction: Journal entries are a systematic method of recording transactions as and when they occur. It is a summary of transactions divided into the debit and credit items that are recorded chronologically. It is an act of keeping and recording all the transactions occurring in the business.

Consolidating entries to complete a consolidated worksheet for 20X8

a.

Expert Solution

Explanation of Solution

Journal entries

S.no	Date	Particulars	Debit	Credit
1		Income from subsidiary	$32,000
		Income from SF stock		$32,000
		(To record C’s 80% share of S’s income)

2		Income to non- controlling interest	$9,000
		Non-controlling interest		$9,000
		(To record non-controlling interest of net income of S)

3		Common stock- SF	$90,000
		Retained earnings as on Jan 1	$220,000
		Investment in SF stock		$248,000
		Non- controlling stock		$62,000
		(To record basic elimination entry)

4		Retained earnings as on Jan 1	$16,000
		Non-controlling interest	$4,000
		Cost of goods sold		$20,000
		(To record reversal of the deferred gross profit)

5		Sales	$150,000
		Cost of goods sold		$135,000
		Inventory		$15,000
		To eliminate the unrealized inventory profit)

Recording the eliminating entry for elimination of income from subsidiary.
Recording the eliminating entry for assigning income to non-controlling interest.
Recording the eliminating entry for elimination of beginning investment balance.
Recording the eliminating entry for elimination of beginning inventory profit.
Recording the eliminating entry for elimination of unrealized inventory profit.

b.

To determine

Introduction: The consolidated income is the difference between the sum of the total operating income of the parent company and the net income of the subsidiary and the unrealized inventory profits of the two. The income assigned to controlling interest is the difference between income assigned to non-controlling interest and the consolidated net income.

The amount reported as consolidated net income and income assigned to the controlling interest.

b.

Expert Solution

Answer to Problem 6.22P

The consolidated net income is $90,000

The income assigned to controlling interest is $81,000

Explanation of Solution

Consolidated net income

Particulars	Amount	Amount
Operating income of CA	$45,000
Net income of SF	$40,000
Total income		$85,000
inventory profits realized in 20X7		$20,000
Unrealized inventory profits for 20X8		($15,000)
Consolidated net income		$90,000

Income assigned to controlling interest

Particulars	Amount
Consolidated net income	$90,000
Less: income assigned to non- controlling interest (40,000+20,000−15,000)×20%	($9,000)
Income assigned to controlling interest	$81,000

c.

To determine

Introduction: A non-controlling interest refers to an ownership position in which the shareholders hold less than 50 percent of the total shares in the company and have no control over its decisions.

Income assigned to non- controlling shareholders.

c.

Expert Solution

Answer to Problem 6.22P

Income assigned to non-controlling shareholders is $67,000.

Explanation of Solution

Particulars	Amount
Common stock	$90,000
Retained earnings (220,000+40,000)	$260,000
Less: unrealized inventory profit	($15,000)
Proportion of stock held by non-controlling interest	20%
Income assigned to non- controlling shareholders	$67,000

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Answer 2

Question

Chapter 6, Problem 6.22P

a.

To determine

Introduction: Journal entries are a systematic method of recording transactions as and when they occur. It is a summary of transactions divided into the debit and credit items that are recorded chronologically. It is an act of keeping and recording all the transactions occurring in the business.

Consolidating entries to complete a consolidated worksheet for 20X8

a.

Expert Solution

Explanation of Solution

Journal entries

S.no	Date	Particulars	Debit	Credit
1		Income from subsidiary	$32,000
		Income from SF stock		$32,000
		(To record C’s 80% share of S’s income)

2		Income to non- controlling interest	$9,000
		Non-controlling interest		$9,000
		(To record non-controlling interest of net income of S)

3		Common stock- SF	$90,000
		Retained earnings as on Jan 1	$220,000
		Investment in SF stock		$248,000
		Non- controlling stock		$62,000
		(To record basic elimination entry)

4		Retained earnings as on Jan 1	$16,000
		Non-controlling interest	$4,000
		Cost of goods sold		$20,000
		(To record reversal of the deferred gross profit)

5		Sales	$150,000
		Cost of goods sold		$135,000
		Inventory		$15,000
		To eliminate the unrealized inventory profit)

Recording the eliminating entry for elimination of income from subsidiary.
Recording the eliminating entry for assigning income to non-controlling interest.
Recording the eliminating entry for elimination of beginning investment balance.
Recording the eliminating entry for elimination of beginning inventory profit.
Recording the eliminating entry for elimination of unrealized inventory profit.

b.

To determine

Introduction: The consolidated income is the difference between the sum of the total operating income of the parent company and the net income of the subsidiary and the unrealized inventory profits of the two. The income assigned to controlling interest is the difference between income assigned to non-controlling interest and the consolidated net income.

The amount reported as consolidated net income and income assigned to the controlling interest.

b.

Expert Solution

Answer to Problem 6.22P

The consolidated net income is $90,000

The income assigned to controlling interest is $81,000

Explanation of Solution

Consolidated net income

Particulars	Amount	Amount
Operating income of CA	$45,000
Net income of SF	$40,000
Total income		$85,000
inventory profits realized in 20X7		$20,000
Unrealized inventory profits for 20X8		($15,000)
Consolidated net income		$90,000

Income assigned to controlling interest

Particulars	Amount
Consolidated net income	$90,000
Less: income assigned to non- controlling interest (40,000+20,000−15,000)×20%	($9,000)
Income assigned to controlling interest	$81,000

c.

To determine

Introduction: A non-controlling interest refers to an ownership position in which the shareholders hold less than 50 percent of the total shares in the company and have no control over its decisions.

Income assigned to non- controlling shareholders.

c.

Expert Solution

Answer to Problem 6.22P

Income assigned to non-controlling shareholders is $67,000.

Explanation of Solution

Particulars	Amount
Common stock	$90,000
Retained earnings (220,000+40,000)	$260,000
Less: unrealized inventory profit	($15,000)
Proportion of stock held by non-controlling interest	20%
Income assigned to non- controlling shareholders	$67,000

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Answer 3

Question

Chapter 6, Problem 6.22P

a.

To determine

Introduction: Journal entries are a systematic method of recording transactions as and when they occur. It is a summary of transactions divided into the debit and credit items that are recorded chronologically. It is an act of keeping and recording all the transactions occurring in the business.

Consolidating entries to complete a consolidated worksheet for 20X8

a.

Expert Solution

Explanation of Solution

Journal entries

S.no	Date	Particulars	Debit	Credit
1		Income from subsidiary	$32,000
		Income from SF stock		$32,000
		(To record C’s 80% share of S’s income)

2		Income to non- controlling interest	$9,000
		Non-controlling interest		$9,000
		(To record non-controlling interest of net income of S)

3		Common stock- SF	$90,000
		Retained earnings as on Jan 1	$220,000
		Investment in SF stock		$248,000
		Non- controlling stock		$62,000
		(To record basic elimination entry)

4		Retained earnings as on Jan 1	$16,000
		Non-controlling interest	$4,000
		Cost of goods sold		$20,000
		(To record reversal of the deferred gross profit)

5		Sales	$150,000
		Cost of goods sold		$135,000
		Inventory		$15,000
		To eliminate the unrealized inventory profit)

Recording the eliminating entry for elimination of income from subsidiary.
Recording the eliminating entry for assigning income to non-controlling interest.
Recording the eliminating entry for elimination of beginning investment balance.
Recording the eliminating entry for elimination of beginning inventory profit.
Recording the eliminating entry for elimination of unrealized inventory profit.

b.

To determine

Introduction: The consolidated income is the difference between the sum of the total operating income of the parent company and the net income of the subsidiary and the unrealized inventory profits of the two. The income assigned to controlling interest is the difference between income assigned to non-controlling interest and the consolidated net income.

The amount reported as consolidated net income and income assigned to the controlling interest.

b.

Expert Solution

Answer to Problem 6.22P

The consolidated net income is $90,000

The income assigned to controlling interest is $81,000

Explanation of Solution

Consolidated net income

Particulars	Amount	Amount
Operating income of CA	$45,000
Net income of SF	$40,000
Total income		$85,000
inventory profits realized in 20X7		$20,000
Unrealized inventory profits for 20X8		($15,000)
Consolidated net income		$90,000

Income assigned to controlling interest

Particulars	Amount
Consolidated net income	$90,000
Less: income assigned to non- controlling interest (40,000+20,000−15,000)×20%	($9,000)
Income assigned to controlling interest	$81,000

c.

To determine

Introduction: A non-controlling interest refers to an ownership position in which the shareholders hold less than 50 percent of the total shares in the company and have no control over its decisions.

Income assigned to non- controlling shareholders.

c.

Expert Solution

Answer to Problem 6.22P

Income assigned to non-controlling shareholders is $67,000.

Explanation of Solution

Particulars	Amount
Common stock	$90,000
Retained earnings (220,000+40,000)	$260,000
Less: unrealized inventory profit	($15,000)
Proportion of stock held by non-controlling interest	20%
Income assigned to non- controlling shareholders	$67,000

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Answer 4

Question

Chapter 6, Problem 6.22P

a.

To determine

Introduction: Journal entries are a systematic method of recording transactions as and when they occur. It is a summary of transactions divided into the debit and credit items that are recorded chronologically. It is an act of keeping and recording all the transactions occurring in the business.

Consolidating entries to complete a consolidated worksheet for 20X8

a.

Expert Solution

Explanation of Solution

Journal entries

S.no	Date	Particulars	Debit	Credit
1		Income from subsidiary	$32,000
		Income from SF stock		$32,000
		(To record C’s 80% share of S’s income)

2		Income to non- controlling interest	$9,000
		Non-controlling interest		$9,000
		(To record non-controlling interest of net income of S)

3		Common stock- SF	$90,000
		Retained earnings as on Jan 1	$220,000
		Investment in SF stock		$248,000
		Non- controlling stock		$62,000
		(To record basic elimination entry)

4		Retained earnings as on Jan 1	$16,000
		Non-controlling interest	$4,000
		Cost of goods sold		$20,000
		(To record reversal of the deferred gross profit)

5		Sales	$150,000
		Cost of goods sold		$135,000
		Inventory		$15,000
		To eliminate the unrealized inventory profit)

Recording the eliminating entry for elimination of income from subsidiary.
Recording the eliminating entry for assigning income to non-controlling interest.
Recording the eliminating entry for elimination of beginning investment balance.
Recording the eliminating entry for elimination of beginning inventory profit.
Recording the eliminating entry for elimination of unrealized inventory profit.

b.

To determine

Introduction: The consolidated income is the difference between the sum of the total operating income of the parent company and the net income of the subsidiary and the unrealized inventory profits of the two. The income assigned to controlling interest is the difference between income assigned to non-controlling interest and the consolidated net income.

The amount reported as consolidated net income and income assigned to the controlling interest.

b.

Expert Solution

Answer to Problem 6.22P

The consolidated net income is $90,000

The income assigned to controlling interest is $81,000

Explanation of Solution

Consolidated net income

Particulars	Amount	Amount
Operating income of CA	$45,000
Net income of SF	$40,000
Total income		$85,000
inventory profits realized in 20X7		$20,000
Unrealized inventory profits for 20X8		($15,000)
Consolidated net income		$90,000

Income assigned to controlling interest

Particulars	Amount
Consolidated net income	$90,000
Less: income assigned to non- controlling interest (40,000+20,000−15,000)×20%	($9,000)
Income assigned to controlling interest	$81,000

c.

To determine

Introduction: A non-controlling interest refers to an ownership position in which the shareholders hold less than 50 percent of the total shares in the company and have no control over its decisions.

Income assigned to non- controlling shareholders.

c.

Expert Solution

Answer to Problem 6.22P

Income assigned to non-controlling shareholders is $67,000.

Explanation of Solution

Particulars	Amount
Common stock	$90,000
Retained earnings (220,000+40,000)	$260,000
Less: unrealized inventory profit	($15,000)
Proportion of stock held by non-controlling interest	20%
Income assigned to non- controlling shareholders	$67,000

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Answer 5

Chapter 6, Problem 6.22P

a.

To determine

Introduction: Journal entries are a systematic method of recording transactions as and when they occur. It is a summary of transactions divided into the debit and credit items that are recorded chronologically. It is an act of keeping and recording all the transactions occurring in the business.

Consolidating entries to complete a consolidated worksheet for 20X8

a.

Expert Solution

Explanation of Solution

Journal entries

S.no	Date	Particulars	Debit	Credit
1		Income from subsidiary	$32,000
		Income from SF stock		$32,000
		(To record C’s 80% share of S’s income)

2		Income to non- controlling interest	$9,000
		Non-controlling interest		$9,000
		(To record non-controlling interest of net income of S)

3		Common stock- SF	$90,000
		Retained earnings as on Jan 1	$220,000
		Investment in SF stock		$248,000
		Non- controlling stock		$62,000
		(To record basic elimination entry)

4		Retained earnings as on Jan 1	$16,000
		Non-controlling interest	$4,000
		Cost of goods sold		$20,000
		(To record reversal of the deferred gross profit)

5		Sales	$150,000
		Cost of goods sold		$135,000
		Inventory		$15,000
		To eliminate the unrealized inventory profit)

Recording the eliminating entry for elimination of income from subsidiary.
Recording the eliminating entry for assigning income to non-controlling interest.
Recording the eliminating entry for elimination of beginning investment balance.
Recording the eliminating entry for elimination of beginning inventory profit.
Recording the eliminating entry for elimination of unrealized inventory profit.

b.

To determine

Introduction: The consolidated income is the difference between the sum of the total operating income of the parent company and the net income of the subsidiary and the unrealized inventory profits of the two. The income assigned to controlling interest is the difference between income assigned to non-controlling interest and the consolidated net income.

The amount reported as consolidated net income and income assigned to the controlling interest.

b.

Expert Solution

Answer to Problem 6.22P

The consolidated net income is $90,000

The income assigned to controlling interest is $81,000

Explanation of Solution

Consolidated net income

Particulars	Amount	Amount
Operating income of CA	$45,000
Net income of SF	$40,000
Total income		$85,000
inventory profits realized in 20X7		$20,000
Unrealized inventory profits for 20X8		($15,000)
Consolidated net income		$90,000

Income assigned to controlling interest

Particulars	Amount
Consolidated net income	$90,000
Less: income assigned to non- controlling interest (40,000+20,000−15,000)×20%	($9,000)
Income assigned to controlling interest	$81,000

c.

To determine

Introduction: A non-controlling interest refers to an ownership position in which the shareholders hold less than 50 percent of the total shares in the company and have no control over its decisions.

Income assigned to non- controlling shareholders.

c.

Expert Solution

Answer to Problem 6.22P

Income assigned to non-controlling shareholders is $67,000.

Explanation of Solution

Particulars	Amount
Common stock	$90,000
Retained earnings (220,000+40,000)	$260,000
Less: unrealized inventory profit	($15,000)
Proportion of stock held by non-controlling interest	20%
Income assigned to non- controlling shareholders	$67,000

Answer 6

Chapter 6, Problem 6.22P

a.

To determine

Introduction: Journal entries are a systematic method of recording transactions as and when they occur. It is a summary of transactions divided into the debit and credit items that are recorded chronologically. It is an act of keeping and recording all the transactions occurring in the business.

Consolidating entries to complete a consolidated worksheet for 20X8

a.

Expert Solution

Explanation of Solution

Journal entries

S.no	Date	Particulars	Debit	Credit
1		Income from subsidiary	$32,000
		Income from SF stock		$32,000
		(To record C’s 80% share of S’s income)

2		Income to non- controlling interest	$9,000
		Non-controlling interest		$9,000
		(To record non-controlling interest of net income of S)

3		Common stock- SF	$90,000
		Retained earnings as on Jan 1	$220,000
		Investment in SF stock		$248,000
		Non- controlling stock		$62,000
		(To record basic elimination entry)

4		Retained earnings as on Jan 1	$16,000
		Non-controlling interest	$4,000
		Cost of goods sold		$20,000
		(To record reversal of the deferred gross profit)

5		Sales	$150,000
		Cost of goods sold		$135,000
		Inventory		$15,000
		To eliminate the unrealized inventory profit)

Recording the eliminating entry for elimination of income from subsidiary.
Recording the eliminating entry for assigning income to non-controlling interest.
Recording the eliminating entry for elimination of beginning investment balance.
Recording the eliminating entry for elimination of beginning inventory profit.
Recording the eliminating entry for elimination of unrealized inventory profit.

Answer 7

Chapter 6, Problem 6.22P

a.

To determine

Introduction: Journal entries are a systematic method of recording transactions as and when they occur. It is a summary of transactions divided into the debit and credit items that are recorded chronologically. It is an act of keeping and recording all the transactions occurring in the business.

Consolidating entries to complete a consolidated worksheet for 20X8

Answer 8

a.

Expert Solution

Explanation of Solution

Journal entries

S.no	Date	Particulars	Debit	Credit
1		Income from subsidiary	$32,000
		Income from SF stock		$32,000
		(To record C’s 80% share of S’s income)

2		Income to non- controlling interest	$9,000
		Non-controlling interest		$9,000
		(To record non-controlling interest of net income of S)

3		Common stock- SF	$90,000
		Retained earnings as on Jan 1	$220,000
		Investment in SF stock		$248,000
		Non- controlling stock		$62,000
		(To record basic elimination entry)

4		Retained earnings as on Jan 1	$16,000
		Non-controlling interest	$4,000
		Cost of goods sold		$20,000
		(To record reversal of the deferred gross profit)

5		Sales	$150,000
		Cost of goods sold		$135,000
		Inventory		$15,000
		To eliminate the unrealized inventory profit)

Recording the eliminating entry for elimination of income from subsidiary.
Recording the eliminating entry for assigning income to non-controlling interest.
Recording the eliminating entry for elimination of beginning investment balance.
Recording the eliminating entry for elimination of beginning inventory profit.
Recording the eliminating entry for elimination of unrealized inventory profit.

Answer 9

a.

Expert Solution

Answer 10

a.

Expert Solution

Answer 11

Expert Solution

Answer 12

b.

To determine

Introduction: The consolidated income is the difference between the sum of the total operating income of the parent company and the net income of the subsidiary and the unrealized inventory profits of the two. The income assigned to controlling interest is the difference between income assigned to non-controlling interest and the consolidated net income.

The amount reported as consolidated net income and income assigned to the controlling interest.

b.

Expert Solution

Answer to Problem 6.22P

The consolidated net income is $90,000

The income assigned to controlling interest is $81,000

Explanation of Solution

Consolidated net income

Particulars	Amount	Amount
Operating income of CA	$45,000
Net income of SF	$40,000
Total income		$85,000
inventory profits realized in 20X7		$20,000
Unrealized inventory profits for 20X8		($15,000)
Consolidated net income		$90,000

Income assigned to controlling interest

Particulars	Amount
Consolidated net income	$90,000
Less: income assigned to non- controlling interest (40,000+20,000−15,000)×20%	($9,000)
Income assigned to controlling interest	$81,000

Answer 13

b.

To determine

Introduction: The consolidated income is the difference between the sum of the total operating income of the parent company and the net income of the subsidiary and the unrealized inventory profits of the two. The income assigned to controlling interest is the difference between income assigned to non-controlling interest and the consolidated net income.

The amount reported as consolidated net income and income assigned to the controlling interest.

Answer 14

b.

Expert Solution

Answer to Problem 6.22P

The consolidated net income is $90,000

The income assigned to controlling interest is $81,000

Answer 15

b.

Expert Solution

Answer 16

b.

Expert Solution

Answer 17

Expert Solution

Answer 18

Explanation of Solution

Consolidated net income

Particulars	Amount	Amount
Operating income of CA	$45,000
Net income of SF	$40,000
Total income		$85,000
inventory profits realized in 20X7		$20,000
Unrealized inventory profits for 20X8		($15,000)
Consolidated net income		$90,000

Income assigned to controlling interest

Particulars	Amount
Consolidated net income	$90,000
Less: income assigned to non- controlling interest (40,000+20,000−15,000)×20%	($9,000)
Income assigned to controlling interest	$81,000

Answer 19

c.

To determine

Introduction: A non-controlling interest refers to an ownership position in which the shareholders hold less than 50 percent of the total shares in the company and have no control over its decisions.

Income assigned to non- controlling shareholders.

c.

Expert Solution

Answer to Problem 6.22P

Income assigned to non-controlling shareholders is $67,000.

Explanation of Solution

Particulars	Amount
Common stock	$90,000
Retained earnings (220,000+40,000)	$260,000
Less: unrealized inventory profit	($15,000)
Proportion of stock held by non-controlling interest	20%
Income assigned to non- controlling shareholders	$67,000

Answer 20

c.

To determine

Introduction: A non-controlling interest refers to an ownership position in which the shareholders hold less than 50 percent of the total shares in the company and have no control over its decisions.

Income assigned to non- controlling shareholders.

Answer 21

c.

Expert Solution

Answer to Problem 6.22P

Income assigned to non-controlling shareholders is $67,000.

Answer 22

c.

Expert Solution

Answer 23

c.

Expert Solution

Answer 24

Expert Solution

Answer 25

Explanation of Solution

Particulars	Amount
Common stock	$90,000
Retained earnings (220,000+40,000)	$260,000
Less: unrealized inventory profit	($15,000)
Proportion of stock held by non-controlling interest	20%
Income assigned to non- controlling shareholders	$67,000