Concept explainers
a.Elimination entries
Sale of shares subsidiary’s to non-affiliate:when subsidiary sells shares to a party outside the economic entity increases total
The amount assigned to non-controlling interest and controlling interest is also affected by two factors 1. The number of shares sold to non-affiliates and 2. The price at which the shares are sold to non-affiliates.
Requirement 1
The consolidation entries needed to prepare consolidated
b.Balance sheet work sheet
Sale of shares subsidiary’s to non-affiliate: when subsidiary sells shares to a party outside the economic entity increases total stockholders’ equity of the consolidated entity by the amount received by the subsidiary from sale. Such as sale increases the subsidiary’s total shares outstanding and reduces the percentage ownership held by the parent company.
The amount assigned to non-controlling interest and controlling interest is also affected by two factors 1. The number of shares sold to non-affiliates and 2. The price at which the shares are sold to non-affiliates.
Requirement 2
The preparation of consolidated balance sheet work sheet as on January 1, 20X3.
c.Consolidated balance sheet
Sale of shares subsidiary’s to non-affiliate: when subsidiary sells shares to a party outside the economic entity increases total stockholders’ equity of the consolidated entity by the amount received by the subsidiary from sale. Such as sale increases the subsidiary’s total shares outstanding and reduces the percentage ownership held by the parent company.
The amount assigned to non-controlling interest and controlling interest is also affected by two factors 1. The number of shares sold to non-affiliates and 2. The price at which the shares are sold to non-affiliates.
Requirement 3
The preparation of consolidated balance sheet January 1 20X3
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Chapter 9 Solutions
Advanced Financial Accounting
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- ABC Company has December unit sales of 12,000 units. Assuming a 5 percent growth, what is the projected unit sales? Solutionarrow_forwardDuring the current year, a business sells equipment for $440,000. The equipment cost $290,000 when purchased and placed in service two years ago and $85,000 of depreciation deductions were allowed. The results of the sale are ____. OPTIONS: A) ordinary income of $120,000. B) Sec. 1231 gain of $120,000. C) ordinary income of $90,000 and LTCL of $30,000. D) ordinary income of $85,000 and Sec. 1231 gain of $150,000.arrow_forwardDuring the current year, a business sells equipment for $440,000. The equipment cost $290,000 when purchased and placed in service two years ago and $85,000 of depreciation deductions were allowed. The results of the sale are ____. OPTIONS: A) ordinary income of $120,000. B) Sec. 1231 gain of $120,000. C) ordinary income of $90,000 and LTCL of $30,000. D) ordinary income of $85,000 and Sec. 1231 gain of $150,000.solve thisarrow_forward
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- How many units were completedarrow_forwardFor the fiscal year, sales were $8,300,000, sales discounts were $100,000, sales returns and allowances were $45,000, and the cost of merchandise sold was $5,000,000. What was the amount of net sales? Accurate Answerarrow_forwardXYZ Corporation reports the following amounts for the fiscal year: Account Amount Assets $9,800 Liabilities $3,500 Stockholders' equity $6,300 Dividends $800 Revenues $7,200 Expenses $4,900 What amount should be reported for net income?arrow_forward
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