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On June 10, 2018, Game Corporation acquired 60 percent of Amber Company’s common stock
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On June 10, 2018, Game Corporation acquired 60 percent of Amber Company’s common stock. The fair value of the noncontrolling interest was $25,600 on that date. Summarized balance sheet data for the two companies immediately after the stock purchase are as follows: |
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Game Corp. |
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Amber Company |
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Item |
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Book Value |
Book Value |
Fair Value |
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Cash |
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$ |
32,800 |
$ |
10,000 |
$ |
10,000 |
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Accounts Receivable |
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45,000 |
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15,000 |
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15,000 |
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Inventory |
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86,000 |
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25,000 |
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30,000 |
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Buildings & Equipment (net) |
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139,000 |
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54,000 |
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74,000 |
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Investment in Amber Stock |
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38,400 |
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Total |
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$ |
341,200 |
$ |
104,000 |
$ |
129,000 |
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Accounts Payable |
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$ |
23,000 |
$ |
2,000 |
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2,000 |
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Bonds Payable |
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210,200 |
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63,000 |
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63,000 |
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Common Stock |
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44,000 |
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11,000 |
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Retained Earnings |
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64,000 |
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28,000 |
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Total |
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$ |
341,200 |
$ |
104,000 |
$ |
65,000 |
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Required: |
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a. |
Record the consolidation entries required to prepare a consolidated balance sheet immediately after the purchase of Amber Company shares. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) |
Record the basic consolidation entry.
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