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.

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Answer 1

Question

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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On December 31, Sawyer Corporation decided to sell one of its manufacturing machines. The initial cost of the equipment was $425,000 with accumulated depreciation of $285,000. Depreciation has been taken up to the end of the year. The company found a buyer willing to purchase the equipment for $95,000. What is the amount of the gain or loss on this transaction?

I am searching for the correct answer to this general accounting problem with proper accounting rules.

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Answer 2

Question

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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Answer 3

Question

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.

Expert Solution & Answer

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Answer 4

Question

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.

Expert Solution & Answer

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Check out a sample textbook solution

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Answer 5

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.

Answer 6

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.

Answer 7

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.

Answer 8

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.

Answer 9

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.

Answer 10

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.

Answer 11

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.

Answer 12

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Answer 13

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Answer 14

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Answer 15

Ch. 8 - Prob. 8.1Q Ch. 8 - What is meant by a constructive bond retirement in...Ch. 8 - Prob. 8.3Q Ch. 8 - Prob. 8.4Q Ch. 8 - When a parent company sells land to a subsidiary...Ch. 8 - Prob. 8.7Q Ch. 8 - Prob. 8.8Q Ch. 8 - Prob. 8.9Q Ch. 8 - Prob. 8.10Q Ch. 8 - Prob. 8.11Q

Solution Summary: The author explains that the effects of intercompany indebtedness must be eliminated for the purpose of consolidated financial statements.

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