- Question Pluto Company Acquired 80 Percent Of Saturn Company S Outstanding Common Stock For 73 600 On January 1 2020 1 (70.21 KiB) Viewed 74 times
- Question Pluto Company Acquired 80 Percent Of Saturn Company S Outstanding Common Stock For 73 600 On January 1 2020 2 (18.66 KiB) Viewed 74 times
QUESTION Pluto
Company acquired 80 percent of Saturn
Company's outstanding common stock for $73,600 on January 1, 2020, when the book value of Saturn's net assets was equals to $92,000. Pluto uses equity method for investments. Adjusted trial balance data for Pluto and Saturn as of December 31, 2020, are as follows: Pluto
Company Saturn
Company DR CR DR CR $12,500 50,000 12,000 Cash & receivables Inventory Patent Investment in Saturn Land Buildings and equipment Cost of Goods Sold Depreciation Expense Administrative and Selling Expenses Dividends Declared Accumulated Depreciation Accounts Payable Notes Payable Common Stock Retained Earnings Sales Income from Saturn Total $57,000 145,000 25,000 78,000 50,000 127,250 114,000 12,500 62,500 22,500 80,000 75,000 35,000 6,500 22,500 4,500 $75,000 95,250 46,000 120,000 80,000 269,500 8,000 $693,750 $44,500 56,300 31,200 60,000 32,000 74,000 $693,750 $298,000 $298,000
Basic Consolidation entry ACCOUNT TITLE Debit Credit Accumulated Depreciation Consolidation Entry ACCOUNT TITLE Debit Credit