ADVANCED FINANCIAL ACCOUNTING-ACCESS
ADVANCED FINANCIAL ACCOUNTING-ACCESS
12th Edition
ISBN: 9781260518740
Author: Christensen
Publisher: MCG
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Chapter 8, Problem 8.1E

a

To determine

Intercompany sale of bonds: When intercompany sale of bonds takes place between affiliates, all effects of intercompany indebtedness must be eliminated for the purpose of consolidated financial statements, as a company cannot report an investment in its own bonds or bond liability to itself. Thus when the consolidated entity is viewed as a single company, all amounts related to intercompany indebtedness are eliminated.

Actual bond retirement: When intercompany sale of bonds takes place between affiliates, all effects of intercompany indebtedness must be eliminated for the purpose of consolidated financial statements. This is referred to as retirement of bond, as a company cannot report an investment in its own bonds or bond liability to itself. Thus when the consolidated entity is viewed as a single company, all amounts related to intercompany indebtedness are eliminated.

The preparation of journal entries for 20X2 for S related to its ownership of P’s bonds.

b

To determine

Intercompany sale of bonds: When intercompany sale of bonds takes place between affiliates, all effects of intercompany indebtedness must be eliminated for the purpose of consolidated financial statements, as a company cannot report an investment in its own bonds or bond liability to itself. Thus when the consolidated entity is viewed as a single company, all amounts related to intercompany indebtedness are eliminated.

Actual bond retirement: When intercompany sale of bonds takes place between affiliates, all effects of intercompany indebtedness must be eliminated for the purpose of consolidated financial statements. This is referred to as retirement of bond, as a company cannot report an investment in its own bonds or bond liability to itself. Thus when the consolidated entity is viewed as a single company, all amounts related to intercompany indebtedness are eliminated.

the preparation of journal entries for 20X2 for P related to bonds.

c

To determine

Intercompany sale of bonds: When intercompany sale of bonds takes place between affiliates, all effects of intercompany indebtedness must be eliminated for the purpose of consolidated financial statements, as a company cannot report an investment in its own bonds or bond liability to itself. Thus when the consolidated entity is viewed as a single company, all amounts related to intercompany indebtedness are eliminated.

Actual bond retirement: When intercompany sale of bonds takes place between affiliates, all effects of intercompany indebtedness must be eliminated for the purpose of consolidated financial statements. This is referred to as retirement of bond, as a company cannot report an investment in its own bonds or bond liability to itself. Thus when the consolidated entity is viewed as a single company, all amounts related to intercompany indebtedness are eliminated.

the preparation elimination entries for consolidation worksheet as on December 31 20X2.

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Pretzel Corporation owns 60 percent of Stick Corporation's voting shares. On January 1, 20X2, Pretzel Corporation sold $160,000 par value, 10 percent first mortgage bonds to Stick for $166,000. The bonds mature in 10 years and pay interest semiannually on January 1 and July 1. Required: a. Prepare the journal entries for 20X2 for Stick related to its ownership of Pretzel's bonds. b. Prepare the journal entries for 20X2 for Pretzel related to the bonds. c. Prepare the worksheet consolidation entries needed on December 31, 20X2, to remove the effects of the intercorporate ownership of bonds. Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required A Required B Required C Prepare the worksheet consolidation entries needed on December 31, 20X2, to remove the effects of the intercorporate ownership of bonds. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do…
Pretzel Corporation owns 60 percent of Stick Corporation's voting shares. On January 1, 20X2, Pretzel Corporation sold $160,000 par value, 10 percent first mortgage bonds to Stick for $166,000. The bonds mature in 10 years and pay interest semiannually on January 1 and July 1. Required: a. Prepare the journal entries for 20X2 for Stick related to its ownership of Pretzel's bonds. b. Prepare the journal entries for 20X2 for Pretzel related to the bonds. c. Prepare the worksheet consolidation entries needed on December 31, 20X2, to remove the effects of the intercorporate ownership of bonds. Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required A Required B Required C Prepare the jourxial entries for 20X2 for Stick related to its ownership of Pretzel's bonds. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round your Intermediate calculations.…

Chapter 8 Solutions

ADVANCED FINANCIAL ACCOUNTING-ACCESS

Ch. 8 - How is the amount of income assigned to the...Ch. 8 - Prob. 8.13QCh. 8 - How would the relationship between interest income...Ch. 8 - Prob. 8.15QCh. 8 - Prob. 8.16QCh. 8 - Prob. 8.17QCh. 8 - Prob. 8.18QCh. 8 - Prob. 8.1CCh. 8 - Prob. 8.2CCh. 8 - Prob. 8.4CCh. 8 - Prob. 8.1ECh. 8 - Bond Sale from Parent to Subsidiary (StraightLine...Ch. 8 - Computation of Transfer Price (Effective Interest...Ch. 8 - Prob. 8.2AECh. 8 - Prob. 8.3ECh. 8 - Bond Sale at Discount (Straightline Method) Assume...Ch. 8 - Evaluation of Intercorporate Bond Holdings...Ch. 8 - Prob. 8.5.1ECh. 8 - Prob. 8.5.2ECh. 8 - MultipleChoice Questions (Effective Interest...Ch. 8 - Prob. 8.5.4ECh. 8 - Prob. 8.5.5ECh. 8 - Prob. 8.5.6ECh. 8 - Prob. 8.5.1AECh. 8 - Prob. 8.5.2AECh. 8 - Prob. 8.5.3AECh. 8 - Prob. 8.5.4AECh. 8 - Prob. 8.6.1ECh. 8 - Prob. 8.6.2ECh. 8 - MultipleChoice Questions (Effective Interest...Ch. 8 - Prob. 8.6.1AECh. 8 - Prob. 8.6.2AECh. 8 - Prob. 8.6.3AECh. 8 - Prob. 8.7ECh. 8 - Prob. 8.7AECh. 8 - Prob. 8.8ECh. 8 - Prob. 8.8AECh. 8 - Prob. 8.9ECh. 8 - Prob. 8.9AECh. 8 - Prob. 8.10ECh. 8 - Prob. 8.10AECh. 8 - Prob. 8.11ECh. 8 - Prob. 8.11AECh. 8 - Evaluation of Bond Retirement (Effective Interest...Ch. 8 - Prob. 8.12AECh. 8 - Prob. 8.13ECh. 8 - Prob. 8.13AECh. 8 - Prob. 8.14PCh. 8 - Prob. 8.14APCh. 8 - Prob. 8.15PCh. 8 - Prob. 8.15APCh. 8 - Prob. 8.16PCh. 8 - Prob. 8.16APCh. 8 - Prob. 8.17PCh. 8 - Prob. 8.17APCh. 8 - Prob. 8.18PCh. 8 - Prob. 8.18APCh. 8 - Prob. 8.19APCh. 8 - Prob. 8.20PCh. 8 - Prob. 8.20APCh. 8 - Prob. 8.21PCh. 8 - Prob. 8.21APCh. 8 - Prob. 8.22APCh. 8 - Prob. 8.22BPCh. 8 - Prob. 8.23PCh. 8 - Prob. 8.23APCh. 8 - Prob. 8.24PCh. 8 - Prob. 8.24APCh. 8 - Intercorporate Inventory and Debt Transfers...Ch. 8 - Intercorporate Inventory and Debt Transfers...Ch. 8 - Prob. 8.26PCh. 8 - Prob. 8.26APCh. 8 - Prob. 8.27.1BPCh. 8 - Prob. 8.27.2BPCh. 8 - Prob. 8.27.3BPCh. 8 - Prob. 8.27.4BPCh. 8 - Prob. 8.27.5BPCh. 8 - Prob. 8.27.6BPCh. 8 - Prob. 8.27.7BPCh. 8 - Prob. 8.27.8BPCh. 8 - Prob. 8.27.9BPCh. 8 - Prob. 8.27.10BPCh. 8 - Prob. 8.28PCh. 8 - Prob. 8.28APCh. 8 - Prob. 8.29BPCh. 8 - Prob. 8.30BP
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