Complete consolidation working papers for powl corporation

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Reference no: EM131797618

Soal Kelompok Advanced Accounting 2016

Powl Corporation acquired 90% of the voting stock of Sowl Corporation on January 1, 2014 for $7,000 when Sowl had Capital Stock of $5,000 and Retained Earnings of $1,500. The excess of cost over book value was allocated $150 to inventories that were sold in 2014, $200 to undervalued land, $400 to undervalued equipment with a remaining useful life of 5 years under the straight-line method, and the remainder to goodwill.

Financial statements for Powl and Sowl Corporations at the end of the fiscal year ended December 31, 2015 appear in the first two columns of the partially completed consolidation working papers. Powl has accounted for its investment in Sowl using the equity method of accounting. Powl Corporation owed Sowl Corporation $100 on open account at the end of the year. Dividends receivable in the amount of $450 payable from Sowl to Powl is included in Powl's net receivables.

Required:

Complete the consolidation working papers for Powl Corporation and Subsidiary.

Powl Corporation and Subsidiary

           

Consolidated Balance Sheet Working Papers

           

at December 31, 2015

 

 

 

 

 

 

 

 Powl

 Sowl

Elimination

NCI

Consolidated

Debit

Credit

INCOME STATEMENT

 

 

 

 

 

 

Sales

                10,000

                6,500

 

 

 

 

Equity in Income Sowl

                  1,270

 

 

 

 

 

Cost of Sales

                 (4,000)

              (3,300)

 

 

 

 

Depreciation expense

                 (1,000)

              (1,000)

 

 

 

 

Other expenses

                 (1,800)

                 (700)

 

 

 

 

Net income

                  4,470

                1,500

 

 

 

 

NCI share of Income

 

 

 

 

 

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

RE Statements

 

 

 

 

 

 

Retained Earnings 1/1

                  2,510

                2,000

 

 

 

 

Net income

                  4,470

                1,500

 

 

 

 

Dividends

                 (2,000)

              (1,000)

 

 

 

 

Retained Earnings 12/31

                  4,980

                2,500

 

 

 

 

SOFP

 

 

 

 

 

 

Cash

                  1,440

                1,900

 

 

 

 

Receivables-net

                  1,550

                   600

 

 

 

 

Inventories

                  1,500

                1,200

 

 

 

 

Land

                  1,000

                   600

 

 

 

 

Equipment and

 

 

 

 

 

 

Buildings-net

                  7,500

                5,700

 

 

 

 

Investment in Sowl

                  7,590

                     -  

 

 

 

 

TOTAL ASSETS

                20,580

              10,000

 

 

 

 

LIAB. & EQUITY

 

 

 

 

 

 

Accounts payable

                  3,000

                2,000

 

 

 

 

Dividends payable

                  1,000

                   500

 

 

 

 

Capital Stock

                11,600

                5,000

 

 

 

 

Retained Earnings

                  4,980

                2,500

 

 

 

 

LIAB. & EQUITY

                20,580

              10,000

 

 

 

 

Reference no: EM131797618

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