Question
In: Accounting
n January 1, 2020, Corgan Company acquired 70 percent of the outstanding voting stock of Smashing,...
n January 1, 2020, Corgan Company acquired 70 percent of the outstanding voting stock of Smashing, Inc., for a total of $1,155,000 in cash and other consideration. At the acquisition date, Smashing had common stock of $840,000, retained earnings of $390,000, and a noncontrolling interest fair value of $495,000. Corgan attributed the excess of fair value over Smashing's book value to various covenants with a 20-year remaining life. Corgan uses the equity method to account for its investment in Smashing.
During the next two years, Smashing reported the following:
Net Income Dividends Declared. Inventory Purchases from Corgan
| 2020 | $ | 290,000 | $ | 49,000 | $ | 240,000 | |||
| 2021 | 270,000 | 59,000 | 260,000 | ||||||
Corgan sells inventory to Smashing using a 60 percent markup on cost. At the end of 2020 and 2021, 40 percent of the current year purchases remain in Smashing's inventory.
- Prepare the worksheet adjustments for the December 31, 2021, consolidation of Corgan and Smashing.
- Prepare the worksheet adjustments for the December 31, 2021, consolidation of Corgan and Smashing.
Solutions
ekkarill92 answered 1 year agoRelated Solutions
On January 1, 2020, Corgan Company acquired 70 percent of the outstanding voting stock of Smashing,...
On January 1, 2020, Corgan Company acquired 70 percent of the
outstanding voting stock of Smashing, Inc., for a total of
$1,435,000 in cash and other consideration. At the acquisition
date, Smashing had common stock of $920,000, retained earnings of
$470,000, and a noncontrolling interest fair value of $615,000.
Corgan attributed the excess of fair value over Smashing's book
value to various covenants with a 20-year remaining life. Corgan
uses the equity method to account for its investment in
Smashing....
On January 1, 2020, Corgan Company acquired 70 percent of the outstanding voting stock of Smashing,...
On January 1, 2020, Corgan Company acquired 70 percent of the
outstanding voting stock of Smashing, Inc., for a total of $910,000
in cash and other consideration. At the acquisition date, Smashing
had common stock of $770,000, retained earnings of $320,000, and a
noncontrolling interest fair value of $390,000. Corgan attributed
the excess of fair value over Smashing's book value to various
covenants with a 20-year remaining life. Corgan uses the equity
method to account for its investment in Smashing....
On January 1, 2020, Corgan Company acquired 70 percent of the outstanding voting stock of Smashing,...
On January 1, 2020, Corgan Company acquired 70 percent of the
outstanding voting stock of Smashing, Inc., for a total of
$1,225,000 in cash and other consideration. At the acquisition
date, Smashing had common stock of $860,000, retained earnings of
$410,000, and a noncontrolling interest fair value of $525,000.
Corgan attributed the excess of fair value over Smashing's book
value to various covenants with a 20-year remaining life. Corgan
uses the equity method to account for its investment in
Smashing....
On January 1, 2020, Corgan Company acquired 70 percent of the outstanding voting stock of Smashing,...
On January 1, 2020, Corgan Company acquired 70 percent of the
outstanding voting stock of Smashing, Inc., for a total of
$1,505,000 in cash and other consideration. At the acquisition
date, Smashing had common stock of $940,000, retained earnings of
$490,000, and a noncontrolling interest fair value of $645,000.
Corgan attributed the excess of fair value over Smashing's book
value to various covenants with a 20-year remaining life. Corgan
uses the equity method to account for its investment in Smashing....
On January 1, 2017, Corgan Company acquired 70 percent of the outstanding voting stock of Smashing,...
On January 1, 2017, Corgan Company acquired 70 percent of the
outstanding voting stock of Smashing, Inc., for a total of
$1,155,000 in cash and other consideration. At the acquisition
date, Smashing had common stock of $840,000, retained earnings of
$390,000, and a noncontrolling interest fair value of $495,000.
Corgan attributed the excess of fair value over Smashing's book
value to various covenants with a 20-year remaining life. Corgan
uses the equity method to account for its investment in
Smashing.Net...
On January 1, 2017, Corgan Company acquired 70 percent of the outstanding voting stock of Smashing,...
On January 1, 2017, Corgan Company acquired 70 percent of the
outstanding voting stock of Smashing, Inc., for a total of
$1,015,000 in cash and other consideration. At the acquisition
date, Smashing had common stock of $800,000, retained earnings of
$350,000, and a noncontrolling interest fair value of $435,000.
Corgan attributed the excess of fair value over Smashing's book
value to various covenants with a 20-year remaining life. Corgan
uses the equity method to account for its investment in
Smashing....
On January 1, 2017, Corgan Company acquired 70 percent of the outstanding voting stock of Smashing,...
On January 1, 2017, Corgan Company acquired 70 percent of the
outstanding voting stock of Smashing, Inc., for a total of $980,000
in cash and other consideration. At the acquisition date, Smashing
had common stock of $790,000, retained earnings of $340,000, and a
noncontrolling interest fair value of $420,000. Corgan attributed
the excess of fair value over Smashing's book value to various
covenants with a 20-year remaining life. Corgan uses the equity
method to account for its investment in Smashing....
On January 1, 2017, Corgan Company acquired 70 percent of the outstanding voting stock of Smashing,...
On January 1, 2017, Corgan Company acquired 70 percent of the
outstanding voting stock of Smashing, Inc., for a total of
$1,190,000 in cash and other consideration. At the acquisition
date, Smashing had common stock of $850,000, retained earnings of
$400,000, and a noncontrolling interest fair value of $510,000.
Corgan attributed the excess of fair value over Smashing's book
value to various covenants with a 20-year remaining life. Corgan
uses the equity method to account for its investment in
Smashing....
On January 1, 2017, Corgan Company acquired 70 percent of the outstanding voting stock of Smashing,...
On January 1, 2017, Corgan Company acquired 70 percent of the
outstanding voting stock of Smashing, Inc., for a total of
$1,190,000 in cash and other consideration. At the acquisition
date, Smashing had common stock of $850,000, retained earnings of
$400,000, and a noncontrolling interest fair value of $510,000.
Corgan attributed the excess of fair value over Smashing's book
value to various covenants with a 20-year remaining life. Corgan
uses the equity method to account for its investment in
Smashing....
On January 1, 2017, Corgan Company acquired 70 percent of the outstanding voting stock of Smashing,...
On January 1, 2017, Corgan Company acquired 70 percent of the
outstanding voting stock of Smashing, Inc., for a total of
$1,190,000 in cash and other consideration. At the acquisition
date, Smashing had common stock of $850,000, retained earnings of
$400,000, and a noncontrolling interest fair value of $510,000.
Corgan attributed the excess of fair value over Smashing's book
value to various covenants with a 20-year remaining life. Corgan
uses the equity method to account for its investment in
Smashing....
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