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Accounts payable Accounts receivable Additional paid-in capital Buildings ne:t (20-y-ar lit] Casli and short-terin investments Comifiion stuck Eyleipnicht net (8-year lite) Inventory Land Long-term liabilities (nature 12/31/11) Retained carnings, 1/1/09 Supplies Totals Dchit Credit $ 60,000 $ 50,000 60
Accounts payable Accounts receivable Additional paid-in capital Buildings ne:t (20-y-ar lit] Casli and short-terin investments Comifiion stuck Eyleipnicht net (8-year lite) Inventory Land Long-term liabilities (nature 12/31/11) Retained carnings, 1/1/09 Supplies Totals Dchit Credit $ 60,000 $ 50,000 60.000 140,000 70,000 300,000 240,000 110,000 90,000 180,000 120,000 20,000 $ 720,000 $720,000
Expert Solution
Answer :
(A) Preparation of consolidation worksheet entries for December 31, 2009. :
| Particulars | Debit | Credit | |
| 1 | Common Stock - Jackson Co. | $300,000 | |
| Additional Paid In Capital | $60,000 | ||
| Retained Earnings 1/1/2009 | $120,000 | ||
| Investment in Jackson Co. | $480,000 | ||
| 2 | Land | $12,000 | |
| Buildings | $48,000 | ||
| Patent | $72,000 | ||
| Equipment | $24,000 | ||
| Investment in Jackson Co. | $108,000 | ||
| 3 | Investment Income (96,000 - 6,600) | $89,400 | |
| Investment in Jackson Co. | $89,400 | ||
| 4 | Investment in Jackson Co. | $12,000 | |
| Dividend Paid | $12,000 | ||
| 5 | Amortization Expenses | $6,600 | |
| Equipment | $3,000 | ||
| Buildings | $2,400 | ||
| Patents | $7,200 |
(B) Preparation of consolidation worksheet entries for December 31, 2010. :
| Particulars | Debit | Credit | |
| 1 | Common Stock - Jackson Co. | $300,000 | |
| Additional Paid In Capital | $60,000 | ||
| Retained Earnings (120,000+96,000-12,000) | $204,000 | ||
| Investment in Jackson Co. | $564,000 | ||
| 2 | Land | $12,000 | |
| Building | $45,600 | ||
| Patent | $64,800 | ||
| Equipment | $21,000 | ||
| Investment in Jackson Co | $101,400 | ||
| 3 | Investment Income (132,000-6,600) | $125,400 | |
| Investment in Jackson Co. | $125,400 | ||
| 4 | Investment in Jackson Co. | $36,000 | |
| Dividend Paid | $36,000 | ||
| 5 | Amortization Expenses | $6,600 | |
| Equipment | $3,000 | ||
| Buildings | $2,400 | ||
| Patents | $7,200 |
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