Record the second acquisition of mckenzie stock

Assignment Help Accounting Basics
Reference no: EM13271168

Austin, Inc., acquired 10 percent of McKenzie Corporation on January 1, 2014, for $247,700 although McKenzie's book value on that date was $2,130,000. McKenzie held land that was undervalued by $167,000 on its accounting records. During 2014, McKenzie earned a net income of $323,000 while declaring and paying cash dividends of $121,000. On January 1, 2015, Austin purchased an additional 30 percent of McKenzie for $762,570. McKenzie's land is still undervalued on that date, but then by $191,900. Any additional excess cost was attributable to a trademark with a 10-year life for the first purchase and a 9-year life for the second. The initial 10 percent investment had been maintained at cost because fair values were not readily available. The equity method will now be applied. During 2015, McKenzie reported income of $387,000 and declared and paid dividends of $145,000.

Prepare all of the 2015 journal entries for Austin. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)


1.Record the second acquisition of McKenzie stock.
2.Record the restated reported figures for 2014 to the equity method.
3.Record the income for the year 2015.
4.Record the dividend declaration from McKenzie for the year 2015.
5.Record the collection of dividend from investee for the year 2015.
6.Record the 2015 amortization for first and second purchases

Reference no: EM13271168

Questions Cloud

Explian what is the feed ratio of liters of hbr : What feed rate of the 30.0 wt% HBr solution would be required to produce 1050 kg/hr of product. What is the feed ratio of liters of 12.0 wt% HBr solution to liters of 30.0 wt% HBr solution.
Find the compton shift in the photons wavelength : After a 0.805 nm x-ray photon scatters from a free electron, the electron recoils with a speed equal to 1.32E+6 m/s. find the Compton shift in the photon's wavelength
Explain a method by which the two compounds : You have a solution of NaCl dissolved in water. Describle a method by which these two compounds could be separated.
Find the speed of the exploration vehicle : A spacecraft approaching the earth launches an exploration vehicle. After the launch, What is the speed of the exploration vehicle relative to the spaceship
Record the second acquisition of mckenzie stock : Record the second acquisition of McKenzie stock.
The most famous users of sampling methodologies : Statistical sampling techniques and methodologies are used in many facets of its mission by the U.S. Census Bureau (USCB) and is among the most famous users of sampling methodologies.
Diluted earnings per share : Compute (a) basic earnings per share, and (b) diluted earnings per share.
A hypothetical person who is riding along with the pion : A particle known as a pion lives for a short time before breaking apart into other particles. Suppose a pion is moving at a speed of 0.990c, and an observer who isstationary in a laboratory measures the pion's lifetime to be ? . What is the lif..
Compute the consolidated gain or loss on a consolidated inco : Keenan Company has had bonds payable of $20,000 outstanding for several years.

Reviews

Write a Review

Accounting Basics Questions & Answers

  Should kathy withhold fica taxes fica taxes

Kathy owns and operates a grocery store as a sole proprietor. She pays wages to her husband Joe and their 17-year-old daughter Marla, both of whom work at the store. Should Kathy withhold FICA taxes FICA taxes from the wages paid to Joe and Marla?

  Prepare contribution margin income statement for the month

Prepare a contribution margin income statement for the month with two columns: in the first column, show the resultsfollowing Paul's decision rule.

  Statement concerning the cash budget

Which of the following statements is NOT correct concerning the Cash Budget?

  Improve the kowal manufacturing companys internal controls

Identify weaknesses in current procedures, and explain the threats that they may allow to occur and suggest ways to improve the Kowal Manufacturing Company's internal controls over hiring and payroll processing.

  Medical expenses for the trip

Phil is advised by his family physician that his dependent son, Tony, needs surgery for a benign tumor in his leg. Phil and his son travel to Rochester, Minnesota, for in-patient treatment at the Mayo Clinic, which specializes in this type of surg..

  Determine total current assets

The following accounts were included on Megan's Style Consultants adjusted trial balance at December 31, 2010: What are total current assets?

  Whats the best method to use for businesses

The direct method might be easier to understand but it is also more expensive and more time consuming for the company why is that? and Whats the best method to use for businesses?

  What is budgeted operating income

Assume that COGS is a variable cost and that operating expenses are a fixed cost. What is budgeted operating income for 20X9?

  Journal entries for the sosmer company

Sosmer Co. had these transactions during the current period. Prepare the journal entries for the transactions.

  What is material from the point of view of a bank

The concept of materiality is important in the context of auditing. Materiality is a function of the time, the situation, and the people involved. What is material from the point of view of a bank that lends money to the firm?

  Preparing accurate and truthful financial statements

Who would you say benefits more when a company prepares accurate and truthful financial statements?

  Calculate the estimated inventory

In addition, the controller is aware of $10,000 of inventory that was stolen during August from one of the company's warehouses. Calculate the estimated inventory at the end of August, assuming a markup on cost of 25%.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd