) Matthews Co. acquired all of the common stock of Jackson Co. on January 1, 2017....

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) Matthews Co. acquired all of the common stock of Jackson Co.on January 1, 2017. As of that date, Jackson had the followingtrial balance: Debit Credit Accounts payable $ 60,000 Accountsreceivable $ 50,000 Additional paid-in capital 60,000 Buildings(net) (20-year life) 140,000 Cash and short-term investments 70,000Common stock 300,000 Equipment (net) (8-year life) 240,000Intangible assets (indefinite life) 110,000 Land 90,000 Long-termliabilities (mature 12/31/19) 180,000 Retained earnings, 1/1/17120,000 Supplies 20,000 Totals $ 720,000 $ 720,000 - During 2017,Jackson reported net income of $96,000 while paying dividends of$12,000. During 2018, Jackson reported net income of $132,000 whilepaying dividends of $36,000. Assume that Matthews Co. acquired thecommon stock of Jackson Co. for $588,000 in cash. As of January 1,2017, Jackson's land had a fair value of $102,000, its buildingswere valued at $188,000, and its equipment was appraised at$216,000. Any excess of consideration transferred over fair valueof assets and liabilities acquired is due to an unamortized patentto be amortized over 10 years. Matthews decided to use the equitymethod for this investment. Required: (A.) Prepare consolidationworksheet entries for December 31, 2017. (B.) Prepare consolidationworksheet entries for December 31, 2018.

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Particulars Amount Life Annual Amortization Purchase Price of Jackson Co 588000 Book value 480000 Excess of cost over book value 108000 Excess cost assigned to specific accounts based on fair market values Land 12000 Building 48000 20 2400 Equipment 24000 5 4800 Goodwill 72000 10 7200 Total    See Answer
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