90.2K

Verified Solution

Link Copied!

1. Pizza Corporation acquired 100 percent of Slice Company on January 1, 20X5, for $350,000. Following are selected account balances from Pizza and Slice Corporation as of December 31, 20X5: Slice Corp. Debit Credit $ 110,000 S 180,000 400,000 Item Current Assets Buildings & Equipment Copyrights Investment in Slice Cost of Goods Sold Depreciation Expense Other Expenses Dividends Declared Pizza Corp. Debit Credit 405,000 500,000 900,000 384,500 375,000 60,000 220,000 80,000 100,000 30,000 100,000 30,000 Accumulated Depreciation Liabilities Common Stock Retained Earnings Sales Income from Slice 360,000 500,000 600,000 600,000 800,000 64,500 $ 2.924,500 60,000 300,000 90,000 200,000 300,000 $ 2.924,500 $950,000 $950,000 Additional Information: 1. On January 1, 20X5 the fair market value of Slice's assets equaled their book value with the exception of Plant Assets (with an estimated economic life of 6 years) which had a fair market value in excess in Slice's depreciable assets of $33,000. 2. Pizza used the equity method in accounting for its investment in Slice. 3. Detailed analysis of receivables and payables showed that Slice owed Pizza $10,000 on December 31, 20X5 Required: 1). Prepare a three-part consolidation worksheet as of December 31, 20X5. (15 points) 2). Give all consolidating entries needed to prepare a full set of consolidated financial statements for 20X5. (15 points)

Answer & Explanation Solved by verified expert

See Answer