Akuntansi Keuangan Lanjutan

Nama : YULITA

NIM : 2018031025

Hari Kuliah&Jam : Rabu, 19:30 - 22:00

Nama Dosen : ANIK AGUSTINA Z.M.,Dra.,AK.,M.M

Sekolah Tinggi Ilmu Ekonomi

Yayasan Administrasi Indonesia

Jakarta 2020
 Minggu 1
1.

Balance Sheets of Y and z companies January 1, 2018

Y company Z company
Book Value Fair value Book value Fair value
Cash and receivables Rp2,520,000 Rp2,350,000 Rp2,500,000 Rp2,200,000
Inventories Rp3,780,000 Rp2,331,000 Rp3,475,000 Rp4,400,000
Land Rp3,150,000 Rp3,000,000 Rp3,530,000 Rp3,850,000
Buildings & equipment Rp25,200,000 Rp25,000,000 Rp18,890,000 Rp19,250,000
Accumulated dep-buildings & equipment -Rp9,450,000 -Rp9,450,000
Total assets Rp25,200,000 Rp32,681,000 Rp18,945,000 Rp29,700,000
Current liabilities Rp6,300,000 Rp6,050,000 Rp6,300,000 Rp6,050,000
Bonds payable, 13%, due 1/1/2025, interest payable
semiannually on 6/30 and 12/31 Rp8,250,000 Rp5,500,000
Total liabilities Rp6,300,000 Rp6,050,000 Rp14,550,000 Rp11,550,000
Stockholders Equity
Common stock, $60 par value, 200,000 shares Rp12,000,000
Common stock, $20 par value, 240,000 shares Rp4,800,000
Other contributed capital Rp3,000,000 Rp1,000,000
Retained earnings Rp3,900,000 Rp2,440,000
Total Stockholders equity Rp18,900,000 Rp8,240,000
Total liabilities and Stockholders equity Rp25,200,000 Rp6,050,000 Rp22,790,000 Rp11,550,000

Net assets at book value (Assets-liabilities) Rp18,900,000 Rp4,395,000

Net assets at fair value Rp26,631,000 Rp18,150,000

Assume that on january 1, 2018, Y company, in a merger, acquired the asets and assumed the
liabilities S company. Z Company gave one of its $60 par value common shares to the former
stockholders of Y Company for every two shares of the $20 par value common stock they held.
Throughout this text, the company names Y and Z are frequently used to distinguish a parent
company from a subsidiary. In an asset acquisition, these terms are inappropriate because the
books of the acquired firm are dissolved at the time of acquisition. Nonetheless, the distinction is
useful to avoid confusion between the acquirer and the acquired.

Y Company common stock, is considered to have a fair value per share of $120 after an
appropriate reduction is made in its market value for additional shares issued and for issue costs.
The total value of the stock issued is $21,600,000 ($120 X 180,000 shares). Balance sheets for Y
and Z companies (along with relevant fair value data) on January 1, 2018. Because the book
value of the bonds is $8,250,000, bond discount in the amount of $2,750,000 ($8,250,000 -
$5,500,000) must be recorded to reduce the bonds payable to their present value.
Jurnal :

Cash and Receivables Rp 2,200,000

Inventories Rp 4,400,000
Land Rp 3,850,000
Buildings & Equipment (net) Rp 19,250,000
Discount on Bonds Payable Rp 2,750,000
Goodwill ( 21,600,000* - 18,150,000 ) Rp 3,450,000
Current Liabilites Rp 6,050,000
Bonds Payable Rp 8,250,000
Common Stock* ( 180,000 X Rp 60 ) Rp 10,800,000
Other Contributed Capital* (180,000 X < Rp120-Rp60> ) Rp 10,800,000

*The sum of common stock and other contributed capital is Rp 21,600,000

**Fair value of net assets = Rp 29,700,000-Rp 11,550,000 = Rp 18,150,000

Y company Balance Sheet after Acquisition, January 1, 2018

Cash and receivables Rp4,720,000
Inventories Rp8,180,000
Land Rp7,000,000
Buildings & equipment Rp44,450,000
Accumulated dep-buildings & equipment -Rp9,450,000 Rp35,000,000
Goodwill Rp3,450,000
Total assets Rp58,350,000

Current liabilities Rp12,350,000

Bonds payable Rp8,250,000
Less: Bond Discount Rp2,750,000 Rp5,500,000
Total liabilities Rp17,850,000
Common stock, $60 par value, 380,000 shares outstanding Rp22,800,000
Other contributed capital Rp13,800,000
Retained earnings Rp3,900,000
Total Stockholders equity Rp40,500,000
Total liabilities and Stockholders equity Rp58,350,000
2. 2-3
Prepare the Journal entry on the book of Perez Company to record the ecquisition of Stalton
Company’s assets and liabilities in exchange for the bonds.
Jawaban :

Cash Rp 114,000
Receivable Rp 135,000
Inventories Rp 310,000
Land Rp 315,000
Building (Net) Rp 54,000
Equipment (Net) Rp 30,450
Discount Bond Payable (Old) Rp 40,000
Discount Bond Payable (New) Rp 78,720
Current Liabilities Rp 95,300
Bonds Payable Rp 300,000
Bonds Payable Rp 600,000
Gain Rp 81,870

3. 3-4
a. Record the journal entry on the book of Pham Company to record the ecquisition on
January 1, 2011. It is expected that the earnings target is likely to be met.

Account receivable $65,000

Inventories $99,000
Land $162,000
Building (Net) $450,000
Equipment (Net) $288,000
Goodwill $54,000
Account payable $83,000
Note payable $180,000
Cash $720,000
Estimated liability for contingent consideration $135,000
b. Assuming the aernings contingency is met, prepare the journal entry on Pham Company’s
books to settle the contingency on January 2,2013

Estimated liability for contingent consideration $135,000

Cash $135,000

c. Assuming the aernings contingency is not met, prepare the journal entry on Pham
Company’s books to settle the contingency on January 2,2013

Estimated liability for contingent consideration $135,000

Gain on contingent consideration $135,000
 Minggu 2
1. Y company membeli saham 100% Z company sebesar nilai buku

Consolidated Balance Sheet Workpaper

Y Company & Subsidiary
Juni,3,2019
Elimations Consolidated
Y Company Z Company
Dr Cr Balances
Cash Rp1,610,000 Rp1,330,000 Rp2,940,000
Other current assets Rp4,370,000 Rp1,900,000 Rp6,270,000
Pland & equipment Rp3,910,000 Rp1,710,000 Rp5,620,000
Land Rp2,070,000 Rp1,330,000 Rp3,400,000
Investment in Z company Rp4,370,000 Rp4,370,000
Total assets Rp16,330,000 Rp6,270,000 Rp18,230,000

Liabilities Rp3,260,000 Rp1,900,000 Rp5,160,000

Common stock
Y company Rp5,750,000 Rp5,750,000
Z ompany Rp1,900,000 (I) Rp1,900,000
Other contributed capital
Y company Rp2,470,000 Rp2,470,000
Z ompany Rp1,140,000 (I) Rp1,140,000
Rentained earnings
Y company Rp4,850,000 Rp4,850,000
Z ompany Rp1,330,000 (I) Rp1,330,000
Total Liabilities & Equity Rp16,330,000 Rp6,270,000 Rp4,370,000 Rp4,370,000 Rp18,230,000

Jurnal :

Common Stock Rp 1,900,000

Other Contributed Capital Rp 1,140,000
Retained earning Rp 1,330,000
Investmen in Z Rp 4,370,000
2. 3-6
a. Prepare the investment elimination entry made to complate a consolidated balance
sheet workpaper. Any difference between book value and the value implied by the
purchase price relates to subsidiary land
b. Prepare Shipley Company’s balance sheet as it appeared on December 31, 2010

Consolidated Balance Sheet Workpaper

Price Company & Shipley Company
December,31,2010
Elimations Consolidated
Price Company Shipley Company
Dr Cr Balances
Cash $22,000 $15,900 $37,900
Account receivable $35,000 $22,000 $57,000
Iventory $127,000 $34,600 $161,600
Investment in Shipley company $212,000 $212,000
Pland & equipment $190,000 $147,000 $337,000
Land $120,000 $87,000 $13,412 $13,412 $220,412
Difference $13,412
Total assets $706,000 $306,500 $813,912

Account payable $42,000 $70,500 $112,500

Note payable $100,000 $100,000
Noncontrolling interest in
Shipley company $37,412 $37,412
Common stock
Price company $300,000 $300,000
Shipley ompany $90,000 $90,000
Other contributed capital
Price company $164,000 $164,000
Shipley ompany $90,000 $90,000
Rentained earnings
Price company $100,000 $100,000
Shipley ompany $56,000 $56,000
Total Liabilities & Equity $706,000 $306,500 $262,824 $262,824 $813,912
 Minggu 3

1. Y company membeli saham 100% Z company dengan harga diatas nilai buku

Consolidated Balance Sheet Workpaper

Y Company & Subsidiary
Juni,3,2019
Elimations Consolidated
Y Company Z Company Goodwill
Dr Cr Balances
Cash Rp4,640,000 Rp4,000,000 Rp8,640,000
Other current assets Rp13,600,000 Rp6,400,000 Rp20,000,000
Pland & equipment Rp12,000,000 Rp5,600,000 Rp17,600,000
Land Rp5,600,000 Rp4,000,000 Rp9,600,000
Investment in Z company Rp15,000,000 (l) Rp15,000,000
Goodwill (l) Rp1,400,000 (l) Rp1,400,000 (l) Rp1,400,000
Total assets Rp50,840,000 Rp20,000,000 Rp57,240,000

Liabilities Rp8,640,000 Rp6,400,000 Rp15,040,000

Common stock
Y company Rp18,400,000 Rp18,400,000
Z ompany Rp6,400,000 (I) Rp6,400,000
Other contributed capital
Y company Rp12,000,000 Rp12,000,000
Z ompany Rp3,200,000 (I) Rp3,200,000
Rentained earnings
Y company Rp11,800,000 Rp11,800,000
Z ompany Rp4,000,000 (I) Rp4,000,000
Total Liabilities & Equity Rp50,840,000 Rp20,000,000 Rp15,000,000 (l) Rp15,000,000 Rp57,240,000

Jurnal :

Common Stock Rp 6,400,000

Other Contributed Capital Rp 3,200,000
Retained earning Rp 4,000,000
Goodwill Rp 1,400,000
Inventmen in Z Rp 15,000,000
 2. Y company membeli saham 85% Z company dengan harga dibawah nilai buku

Consolidated Balance Sheet Workpaper

Y Company & Subsidiary
Juni,3,2019
Elimations Noncontrolling Consolidated
Y Company Z Company
Dr Cr Interest Balances
Cash Rp5,850,000 Rp4,200,000 Rp10,050,000
Other current assets Rp14,250,000 Rp6,000,000 Rp20,250,000
Pland & equipment Rp12,750,000 Rp5,400,000 Rp18,150,000
Land Rp8,625,000 Rp4,200,000 Rp12,825,000
Investment in Z company Rp11,730,000 (l) Rp11,730,000
Total assets Rp53,205,000 Rp19,800,000 Rp61,275,000

Liabilities Rp10,450,000 Rp6,000,000 Rp16,450,000

Common stock
Y company Rp20,750,000 Rp20,750,000
Z ompany Rp6,000,000 (I) Rp6,000,000
Other contributed capital
Y company Rp8,750,000 Rp8,750,000
Z ompany Rp3,600,000 (I) Rp3,600,000
Rentained earnings
Y company Rp13,255,000 Rp13,255,000
Z ompany Rp4,200,000 (I) Rp4,200,000
Noncontrolling interest Rp2,070,000
(l) Rp2,070,000 Rp2,070,000
Total Liabilities & Equity Rp53,205,000 Rp19,800,000 Rp13,800,000 (l) Rp13,800,000 Rp61,275,000

Jurnal :

Common Stock Rp 6,000,000

Other Contributed Capital Rp 3,600,000
Retained earning Rp 4,200,000
Inventmen in Z Rp 11,730,000
Noncontrolling Interest Rp 2,070,000
 Minggu 4

1. Neraca Y dan Z pada tanggal 31 desember 2019, satu tahun setelah afiliasi :

Y Z
Cash Rp5,244,000 Rp4,500,000
Deviden receivable Rp1,600,000
Other current assets Rp6,060,000 Rp5,980,000
Plant assets Rp8,100,000 Rp7,500,000
Acumulated depreciation (Rp4,800,000) (Rp2,780,000)
Investment in Z (80%) Rp6,780,000
Total assets Rp22,984,000 Rp15,200,000
Accounts payable Rp3,260,000 Rp3,000,000
Deviden payable Rp2,000,000
Other current liabilities Rp3,400,000 Rp2,600,000
Capital stock Rp9,360,000 Rp4,100,000
Retained earnings Rp6,964,000 Rp3,500,000
Total equities Rp22,984,000 Rp15,200,000

Assumptions
1) Y acquired a 80% interest in Z for Rp 6,300,000 on January 1, 2019, when Z
stuckholders equity was Rp 6,000,000
2) The account payable of Z incule Rp 3,900,000 owed to Y
3) During 2019 Z had income of Rp 4,800,000 and declared Rp 4,200,000 in devidends.
We determine the balance in the Investment in Z account at December 31, 2019, using the equity

Y CORPORATION AND SUBSIDIARY

CONSOLIDATED BALANCE SHEET WORKING PAPERS
DECEMBER 31, 2019 (IN THOUSANDS)
Adjustments and eliminations Consolidated
Y 80% Z
Balance Sheet
Debits Credits
Assets
Cash Rp5,244,000 Rp4,500,000 Rp9,744,000
Deviden receivable Rp1,600,000 Rp1,600,000
Other current assets Rp6,060,000 Rp5,980,000 Rp3,900,000 Rp8,140,000
Plant assets Rp8,100,000 Rp7,500,000 Rp15,600,000
Acumulated depreciation (Rp4,800,000) (Rp2,780,000) (Rp7,580,000)
Investment in Z Rp6,780,000 Rp6,780,000
Goodwill Rp875,000 Rp875,000
Total assets Rp22,984,000 Rp15,200,000 Rp26,779,000
Liabilities and Equity
Accounts payable Rp3,260,000 Rp3,000,000 Rp3,900,000 Rp2,360,000
Devidends payable Rp2,000,000 Rp1,600,000 Rp400,000
Other current liabilities Rp3,400,000 Rp2,600,000 Rp6,000,000
Capital stock - Y Rp9,360,000 Rp9,360,000
Retained earnings - Y Rp6,964,000 Rp6,964,000
Capital stock - Z Rp4,100,000 Rp4,100,000
Retained earnings - Z Rp3,500,000 Rp3,500,000
Rp22,984,000 Rp15,200,000
Noncontrolling interest Rp1,695,000 Rp1,695,000
Total Liabilities and Equity Rp13,975,000 Rp13,975,000 Rp26,779,000
a. To eliminate reciprocal investment and equity balance, record goodwill and enter the noncontrolling interest
(Rp8,475,000 x 20%)
b. To eliminate reciproal devidends receivable and payable amounts (80% of Rp2,000,000 devideends payable of Z)
c. To eliminate intercompany accounts receivable and accounts payable

Method of accounting. Calculations of the December 31, 2019, investment account balance are
follows :

Original investment January 1, 2019 Rp6,300,000

Add: 80% of Z Rp4,800,000 net income for 2019 Rp3,840,000
Deduct: 80% of Z Rp4,200,000 dividends for 2019 (Rp3,360,000)
Investment account balance Deember 31,2019 Rp6,780,000
The working paper entries necessary to consolidate the balance sheets of Yand Z are reproduced
in general journal from for convenient reference:

a. Capital stock-Z (-SE) Rp4,100,000

Retained earnings-Z (-SE) Rp3,500,000
Goodwill (+A) Rp875,000
Investment in Z (-A) Rp6,780,000
Noncontrolling interest (+SE) Rp1,695,000
To eliminate reciprocal investment and equity balance, record
goodwill, and enter the noncontrolling interest (Rp8,550,000 x 20%)
b. Devidends payable (-L) Rp1,600,000
Dividends receivable (-A) Rp1,600,000
To eliminate reciproal devidends receivable and payable amounts
(80% of Rp 2,000,000 devideends payable of Z)
c. Accounts payable (-L) Rp3,900,000
Accounts receivable (-A) Rp3,900,000
To eliminate intercompany accounts receivable and accounts payable
2. P3-11
Prepare consolidated balance sheet working papers for Pansy corporation and Subsidiary on
December 31,2009

PANSY CORPORATION AND SUBSIDIARY

CONSOLIDATED BALANCE SHEET WORKING PAPERS
DECEMBER 31, 2009 (IN THOUSANDS)
Adjustments and eliminations Consolidated
Pansy 90% Snowdrop
Debits Credits Balance Sheet
Assets
Cash Rp300 Rp200 Rp500
Receivables — net Rp600 Rp400 Rp1,000
Dividends receivable Rp90 Rp90
Inventory Rp700 Rp600 Rp1,300
Land Rp600 Rp700 Rp1,300
Buildings — net Rp2,000 Rp1,000 Rp3,000
Equipment — net Rp1,500 Rp800 Rp700 Rp3,000
Investment in Snowdrop Rp3,780 Rp3,780
Goodwill Rp500 Rp500
Total assets Rp9,570 Rp3,700 Rp10,600
Liabilities and Equity
Accounts payable Rp300 Rp600 Rp900
Dividends payable Rp500 Rp100 (Rp90) Rp510
Capital stock Rp7,000 Rp2,000 Rp2,000 Rp7,000
Retained earnings Rp1,770 Rp1,000 Rp1,000 Rp1,770
Noncontrolling interest Rp420 Rp420
Total liabilities and
stockholders equities Rp9,570 Rp3,700 Rp10,600
a. To eliminate reciprocal investment and equity accounts, enter unamortized excess allocated to equipment,
record goodwill, and enter noncontrolling interest.
b. To eliminate reciprocal dividends receivable and dividends payable amounts.
 Minggu 5

1. On December 31, 2019, Y purchases 70% of Z Corporation’s outstanding voting common

stock directly from Z corporation’s stockholders for $263,000,000 cash plus 900,000 shares
of Y corporation $80 per common stock with a market $253,000,000. Additional costs of
combination are $13,000,000. Y pays these additional costs in cash. Y and Z must continue
to operate as parent company and subsidiary because 30% of Z shares are outstanding and
held by noncontrolling stockholders. We expense the $18,900,000 cost in recording the
investment.
Y Corporation Z Corporation
(in thuosands) Per Books Fair Value Per Books Fair Value
Assets
Cash $333,000,000 $333,000,000 $13,000,000 $13,000,000
Receivables-net $38,000,000 $38,000,000 $16,000,000 $16,000,000
Inventories $47,000,000 $63,000,000 $24,000,000 $29,000,000
Other current assets $33,000,000 $43,000,000 $23,000,000 $23,000,000
Land $62,000,000 $563,000,000 $33,000,000 $43,000,000
Buildings-net $402,000,000 $743,000,000 $202,000,000 $252,000,000
Equipment-net $350,000,000 $453,000,000 $101,000,000 $86,000,000
Total assets $1,265,000,000 $2,236,000,000 $412,000,000 $462,000,000
Liabilities and Equity
Accounts payable $103,000,000 $103,000,000 $38,000,000 $38,000,000
Notes Payable $188,000,000 $178,000,000 $73,000,000 $68,000,000
Common stock, $80 par $503,000,000 $181,000,000
Additional paid-in capital $253,000,000 $72,000,000
Retained earnings $218,000,000 $48,000,000
Total Liabilities and stockholders
Equity $1,265,000,000 $412,000,000
Y record yhe business combination on it books with the following journal entries in thousands :

Investment in Z (+A) $516,000,000

Common stock (+SE) $181,000,000
Additional paid-in capital (+SE) $72,000,000
Cash (-A) $263,000,000
To record equisition of 70% of Z corporation's
outstabding stock for $263,000,000 in cash and
900,000 shares of Y common stock with a value of
$253,000,000
Investment expense (E,-SE) $13,000,000
Cash (-A) $13,000,000
To record additional cost of combining with Z

Y CORPORATION AND ITS 70%-OWNED SUNSIDIARY, Z CORPORATION (IN

THOUSANDS)
Fair value (purchase price) of 70% interest acquired $516,000,000
Implied fair value of Z ($516,000,000 / 70%) $737,142,857
Book value of Z net assets ($301,000,000)
Total excess of fair value over book value $436,142,857
Allocation to Indentifiable Assets and Liabilities
Fair value Book value Excess Allocated
Inventories $29,000,000 $24,000,000 $5,000,000
Land $43,000,000 $33,000,000 $10,000,000
Buildings $252,000,000 $202,000,000 $50,000,000
Equipment $86,000,000 $101,000,000 ($15,000,000)
Notes payable $68,000,000 $73,000,000 $5,000,000
Total allocated to identisiable net assets $55,000,000
Remainder allocated to goodwill $381,142,857
Total excess of fair value over book value $436,142,857

The consolidated balance sheet working papers show two working paper entries for the
consolidation. Entry a in general journal form follows:

a. Unamortized excess (+A) $436,142,857

Common stock, $80 par-Z (-SE) $181,000,000
Additional paid-in capital-Z (-SE) $72,000,000
Retained earnings-Z (-SE) $48,000,000
Investment in Z (-A) $516,000,000
Noncontrolling interest-30% (+SE) $221,142,857
70% Ownership, Excess Allocated to Identifiable Net Assets and Goodwill

PILOT CORPORATION AND SUBSIDIARY

CONSOLIDATED BALANCE SHEET WORKING PAPERS
AFTER COMBINATION ON DECEMBER 31,2019 (IN THOUSANDS)
Adjustments and Eliminations Consolidated
Y 70% Z Debits Credits Balance Sheet
Assets
Cash $57,000,000 $13,000,000 $70,000,000
Receivables-net $38,000,000 $16,000,000 $54,000,000
Inventories $47,000,000 $24,000,000 $5,000,000 $76,000,000
Other current assets $33,000,000 $23,000,000 $56,000,000
Land $62,000,000 $33,000,000 $10,000,000 $105,000,000
Buildings-net $402,000,000 $202,000,000 $50,000,000 $654,000,000
Equipment-net $350,000,000 $101,000,000 $15,000,000 $436,000,000
Investment in Z $516,000,000 $516,000,000
Goodwill $381,142,857 $381,142,857
Unamortized excess $436,142,857 $436,142,857
Total assets $1,505,000,000 $412,000,000 $1,832,142,857
Liabilities and Equity
Accounts payable $103,000,000 $38,000,000 $141,000,000
Notes Payable $188,000,000 $73,000,000 $5,000,000 $256,000,000
Common stock-Y $575,000,000 $575,000,000
Other paid-in capital-Y $434,000,000 $434,000,000
Retained earnings-Y $205,000,000 $205,000,000
Common stock-Z $181,000,000 $181,000,000
Other paid-in capital-Z $72,000,000 $72,000,000
Retained earnings-Z $48,000,000 $48,000,000
$1,505,000,000 $412,000,000
Noncontrolling interest $221,142,857 $221,142,857
Total Liabilities and
stockholders Equity $1,832,142,857
a. To eliminate reciprocal subsidiary investment and equity balance, establish noncontrolling interest, and enter the unamortized excess.
b. To allocate the unamortized excess to identifiable assets, liabilities, and goodwill
 A second working paper entry allocates the unamortized excess to individual assets and
liabilities and to goodwill:

b. Invertories (+A) $5,000,000

Land (+A) $10,000,000
Buildings-net (+A) $50,000,000
Goodwill (+A) $381,142,857
Notes payable (-L) $5,000,000
Equipment-net (-A) $15,000,000
Unamortized excess (-A) $436,142,857

2. P3-14
a. Prepare a schedule showing how the excess of Portland’s investment fair value over book
value should be alloated

PORTLAND CORPORATION AND ITS 80%-OWNED SUNSIDIARY, SIDNEY CORPORATION

(IN THOUSANDS)
Fair value (purchase price) of 80% interest acquired $2,760
Implied fair value of Z ($2,760 / 80%) $3,450
Book value of Z net assets ($2,300)
Total excess of fair value over book value $1,150

Fair value Book value Excess Allocated

Inventories $500 $400 $100
Other urrent assets $200 $150 $50
Land $600 $500 $100
Buildings $1,800 $1,000 $800
Equipment $600 $800 ($200)
Other liabilities $560 $610 $50
Total allocated to identisiable net assets $900
Remainder allocated to goodwill $250
Total excess of fair value over book value $1,150

a. Unamortized excess (+A) $1,150

Common stock (-SE) $2,000
Retained earnings-Z (-SE) $300
Investment in Portland (-A) $2,760
Noncontrolling interest-20% (+SE) $690
 b. Prepare a consolidated balance sheet

PORTLAND CORPORATION AND SUBSIDIARY

CONSOLIDATED BALANCE SHEET WORKING PAPERS
AFTER COMBINATION ON DECEMBER 31,2019 (IN THOUSANDS)
Adjustments and Eliminations Consolidated
Portland 70% Sidney Debits Credits Balance Sheet
Assets
Cash $240 $60 $300
Receivables-net $800 $200 $1,000
Inventories $1,100 $400 $100 $1,600
Other current assets $900 $150 $50 $1,100
Land $3,100 $500 $100 $3,700
Buildings-net $6,000 $1,000 $800 $7,800
Equipment-net $3,500 $800 $200 $4,100
Investment in Sidney $2,760 $2,760
Goodwill $250 $250
Unamortized excess $1,150 $1,150
Total assets $18,400 $3,110 $19,850
Liabilities and Equity
Accounts payable $400 $200 $600
Other liabilities $1,500 $610 $50 $2,060
Capital stock $15,000 $2,000 $2,000 $15,000
Retained earnings $1,500 $300 $300 $1,500
$18,400 $3,110
Noncontrolling interest $690 $690
Total Liabilities and
stockholders Equity $19,850
a. To eliminate reciprocal subsidiary investment and equity balance, establish noncontrolling interest, and enter the unamortized
b. To allocate the unamortized excess to identifiable assets, liabilities, and goodwill

b. Invertories (+A) $100

Land (+A) $100
Buildings-net (+A) $800
Goodwill (+A) $250
Other current asset $50
Other liabilities (-L) $50
Equipment-net (-A) $200
Unamortized excess (-A) $1,150
 MINGGU 6

1. Y Corporation pays $32,220,000 for 90% of the outstanding voting stock of Z

Corporation on Januaty 1,2019, when Z Corporation’s stockholders equity equity consists
of $13,500,000 capital stock and $10,800,000 retained earnings. This implies that the
total fair value of Z is $35,800,000 ($32,220,000 : 90%). We allocate the $11,500,000
excess of fair value book value to previously unrecorded patents with a 5-year
amortization period. Z net income and dividends are as follows:

2019 2020
Net income $18,450,000 $18,900,000
Dividends $9,450,000 $9,450,000

Financial statements for Y and Z corporations for 2019 are presented in the firsh
two working paper columns. Y $14,535,000 income from Z for 2019 consists of 90% of
Z $18,450,000 net income for 2019 less $2,070,000 {($11,500,000 : 5 yrs) X 90%}
patent amortization, its $55,260,000 Investment in Z account at December 31,2019,
consists of $32,220,000
Y CORPORATION AND SUBSIDIARY CONSOLIDATION WORKING PAPERS FOR THE YEAR ENDED
DECEMBER 31,2019 (IN THOUSANDS)
Adjustments and
Consolidated
Y 90% Z Eliminationd
Statements
Debits Credits
Income Statement
Revenue $54,900,000 $30,150,000 $85,050,000
Income from Z $14,535,000 $14,535,000
Expenses ($26,100,000) ($11,700,000) $2,300,000 ($40,100,000)
Noncontrolling interest share ($16,150,000 X
10%) $1,615,000 ($1,615,000)
Controlling share $43,335,000 $18,450,000 $43,335,000
Retained Earnings
Retained Earnings-Y $8,550,000 $8,550,000
Retained Earnings-Z $10,800,000 $10,800,000
Add: Net income $43,335,000 $18,450,000 $43,335,000
Deduct: Dividends ($10,800,000) ($9,450,000) $8,505,000
$945,000 ($10,800,000)
Retained earnings-December 31 $41,085,000 $19,800,000 $41,085,000

Balance Sheet
Cash $12,610,000 $10,000,000 $22,610,000
Other current assets $15,400,000 $12,600,000 $28,000,000
Investment in Z $38,250,000 $6,030,000
$32,220,000
Plant and equipment $45,100,000 $30,100,000 $75,200,000
Accumulated depreciation ($8,600,000) ($5,400,000) ($14,000,000)
Patents $11,500,000 $2,300,000 $9,200,000
$102,760,000 $47,300,000 $121,010,000
Liabilities $22,075,000 $14,000,000 $36,075,000
Capital stock $39,600,000 $13,500,000 $13,500,000 $39,600,000
Retained earnings $41,085,000 $19,800,000 $41,085,000

$102,760,000 $47,300,000
Noncontrolling interest January 1 ($35,800,000 fair value X
10%) $3,580,000
Noncontrolling interest Deember 31 $670,000 $4,250,000
$121,010,000
Jurnalnya

a. Income from Z $14,535,000

Deviden $8,505,000
Investmen in Z $6,030,000
b. Noncontrolling interest share $1,615,000
Deviden $945,000
Noncontrolling interest $670,000
c. Reteined earnings $10,800,000
Capital stock $13,500,000
Patents $11,500,000
Investmen in Z $32,220,000
Noncontrolling interest $3,580,000
d. Expense $2,300,000
Patents $2,300,000
2. P 4-8

PEN CORPORATION AND SUBSIDIARY CONSOLIDATION WORKING PAPERS FOR THE YEAR
ENDED DECEMBER 31,2010 (IN THOUSANDS)
Adjustments and
Consolidated
Pen 90% Syn Eliminationd
Statements
Debits Credits
Income statement
Sales $ 400 $ 100 $ 500
Income from Syn $ 21.6 $ 21.6
Cost of sales $ (250) $ (50) $ (300)
Expenses $ (100.6) $ (26) $ (126.6)
Consolidated NI $ 73.4
Noncontrolling share $ 2.4 $ (2.4)
Controlling share of NI $ 71 $ 24 $ 71
Retained Earnings
Retained Earnings - Pen $ 181 $ 181
Retained Earnings - Syn $ 34 $ 34
Controlling share of NI $ 71 $ 24 $ 71
Dividends $ (50) $ (16) $ 14.4
$ 1.6 $ (50)
Retained earnings - Dec 31 $ 202 $ 42 $ 202
Balance Sheet
Cash $ 18 $ 15 $ 33
Accounts receivable $ 80 $ 20 $ 5 $ 95
Devidends receivable $ 7.2 $ 7.2
Inventories $ 95 $ 10 $ 105
Note receivable - Pen $ 5 $ 5
Investment in Syn $ 226.8 $ 7.2
$ 219.6
Land $ 65 $ 30 $ 20 $ 115
Buildings - net $ 170 $ 80 $ 250
Equipment - net $ 130 $ 50 $ 180
Goodwill $ 40 $ 40
$ 792 $ 210 $ 818
Accounts payable $ 85 $ 10 $ 5 $ 90
Note payable o Syn $ 5 $ 5
Devidends payable $ 8 $ 7.2 $ 0.8
Capital stock $ 500 $ 150 $ 150 $ 500
Retained earnings $ 202 $ 42 $ 202
$ 792 $ 210
Noncontrolling interest January 1 $ 24.4
Noncontrolling interest December 31 $ 0.8 $ 25.2
$ 285.2 $ 285.2 $ 818
 3. P4-9

Prepare consolidation working papers for Plastik Corporation and Seldane at and for the year ended
December 31,2009

PLASTIK CORPORATION AND SUBSIDIARY CONSOLIDATION WORKING PAPERS FOR THE YEAR
ENDED DECEMBER 31,2010 (IN THOUSANDS)
Adjustments and
Consolidated
Pelastik 80% Seldane Eliminationd
Statements
Debits Credits
Income statement
Sales $ 200 $ 110 $ 310
Income from Syn $ 18 $ 18
Cost of sales $ (80) $ (40) $ 12.5 $ (132.5)
Depreciation Expenses $ (40) $ (20) $ 5 $ (65)
Other Expenses $ (25.5) $ (10) $ (35.5)
Consolidated NI $ 77
Noncontrolling share $ 4.5 $ (4.50)
Controlling share of NI $ 72.5 $ 40 $ 72.5
Retained Earnings
Retained Earnings - Pelastik $ 75 $ 75
Retained Earnings - Seldane $ 50 $ 50
Controlling share of NI $ 72.5 $ 40 $ 72.5
Dividends $ (40) $ (20) $ 16
$ 4 $ (40)
Retained earnings - Dec 31 $ 107.5 $ 70 $ 107.5
Balance Sheet
Cash $ 29.5 $ 30 $ 59.5
Trade receivable - net $ 28 $ 40 $ 4 $ 64
Devidends receivable $ 8 $ 8
Inventories $ 40 $ 30 $ 70
Land $ 15 $ 30 $ 45
Buildings - net $ 65 $ 70 $ 135
Equipment - net $ 200 $ 100 $ 25 $ 5 $ 320
Investment in Seldane $ 212 $ 2
$ 210
Goodwill $ 25 $ 25
$ 597.5 $ 300 $ 718.50
Accounts payable $ 40 $ 50 $ 4 $ 86
Devidends payable $ 100 $ 10 $ 8 $ 102
Other Liabilities $ 50 $ 20 $ 70
Capital stock $ 300 $ 150 $ 150 $ 300
Retained earnings $ 107.5 $ 70 $ 107.5
$ 597.5 $ 300
Noncontrolling interest January 1 $ 52.5
Noncontrolling interest December 31 $ 0.25 $ 53
$ 302 $ 302 $ 718.50
Investment cost January 1, 2009 $ 210,000
Implied fair value of Seldane ($210,00 / 80%) $ 262,500
book value of Seldane $ (200,000)
Excess fair value over book value $ 62,500
Excess allocated :
Undervalued inventory $ 12,500
Undervalued equipment $ 25,000
Remainder to patents $ 25,000
Excess fair value over book value $ 62,500

Income from seldane

Seldane reported net income $ 40,000
Less amortization of excess fair value :
Inventory $ (12,500)
Depreciation ($2,000/5 years) $ (5,000)
Seldane adjusted income $ 22,500

Plastik 80% controlling share $ 18,000

20% Noncontrolling interest share $ 4,500
 Minggu 7

1. Z Corporation maintains its 90% ownership interest in Z throughout 2020, recording

income from Z of $14,940,000 for the year (90% of Z’s $18,900,000 net income less
$2,300,000 patents amortization). At December 31, 2011, Y’s Investment in Z account
has a balance of $44,685,000, determined as follows:

Investment cost January 1, 2019 $32,220,000

Income from Z—20119 $14,535,000
Dividends from Z—2019 ($8,505,000)
Investment in Z December 31, 2019 $38,250,000
Income from Z—2020 $14,940,000
Dividends from Z—2020 ($8,505,000)
Investment in Z December 31, $44,685,000

The only intercompany transaction between Y and Z during 2020 was a

$9,000,000 non-interest-bearing loan to Z during the third quarter of the year.
There were no errors or omissions or intercompany profits relating to the
consolidation, so the first workpaper entry is to eliminate income and dividends from Z
as follows:

a. Income from Z (-R, − SE ) $14,940,000

Dividends (+ SE ) $8,505,000
Investment in Sap (− A ) $6,435,000
To eliminate income and dividends from Sap and return the
investment account to its beginning-of-the-period balance.

This entry adjusts the Investment in Z account to its $38,250,000 December 31, 2019,
balance and establishes reciprocity with Z’s stockholders’ equity at December 31, 2019.

Entry b incorporates the noncontrolling interest in Z’s net income and the
noncontrolling share of Sap’s dividends:
 b. Noncontrolling interest share ( − SE ) $1,660,000
Dividends (+ SE ) $945,000
Noncontrolling interest (+ SE ) $715,000
To enter noncontrolling interest share of subsidiary income
and dividends.

Entry c eliminates Investment in Z and stockholders’ equity of Z as follows:

c. Retained earnings—Z (− SE ) $19,800,000

Capital stock—Z (− SE ) $13,500,000
Patents (+ A ) $9,200,000
Investment in Z (− A ) $38,250,000
Noncontrolling interest (+ SE ) $4,250,000
To eliminate reciprocal investment and equity balances,
establish beginning noncontrolling interest, and enter
unamortized patents.

Entry c eliminates the Investment in Z and stockholders’ equity of Z amounts at

December 31, 2019, and enters the noncontrolling interest at December 31, 2019;
therefore, the $9,200,000 investment’s fair value difference reflects unamortized patents
at December 31, 2019. Entry d amortizes this amount to the $6,900,000 balance at
December 31, 2020:

d. Expenses ( E, − SE ) $2,300,000
Patents (− A ) $2,300,000
To enter current amortization.

The final workpaper entry eliminates intercompany notes payable and notes
receivable balances because the amounts are not assets and liabilities of the consolidated
entity:

e. Note payable—Y (− L ) $9,000,000

Note receivable—Z (− A ) $9,000,000
To eliminate reciprocal receivable and payable balances.
Y CORPORATION AND SUBSIDIARY CONSOLIDATION WORKING PAPERS FOR THE YEAR ENDED
DECEMBER 31,2020 (IN THOUSANDS)
Adjustments and Consolidated
Y 90% Z
Debits Credits Statements
Income Statement
Revenue $119,300,000 $43,300,000 $162,600,000
Income from Z $14,940,000 $14,940,000
Expenses ($57,120,000) ($24,400,000) $2,300,000 ($83,820,000)
Noncontrolling interest share ($16,600,000 X
10%) $1,660,000 ($1,660,000)
Controlling share of NI $77,120,000 $18,900,000 $77,120,000
Retained Earnings
Retained Earnings-Y $41,085,000 $41,085,000
Retained Earnings-Z $19,800,000 $19,800,000
Add: Net income $77,120,000 $18,900,000 $77,120,000
Deduct: Dividends ($24,300,000) ($9,450,000) $8,505,000
$945,000 ($24,300,000)
Retained earnings-December 31 $93,905,000 $29,250,000 $93,905,000
Balance Sheet
Cash $37,260,000 $25,800,000 $63,060,000
Note receivable-Z $9,000,000 $9,000,000
Other current assets $40,660,000 $26,450,000 $67,110,000
Investment in Z $44,685,000 $6,435,000
$38,250,000
Plant and equipment $45,100,000 $30,100,000 $75,200,000
Accumulated depreciation ($23,400,000) ($17,000,000) ($40,400,000)
Patents $9,200,000 $2,300,000 $6,900,000
$153,305,000 $65,350,000 $171,870,000
Note payable-Y $9,000,000 $9,000,000
Liabilities $19,800,000 $13,600,000 $33,400,000
Capital stock $39,600,000 $13,500,000 $13,500,000 $39,600,000
Retained earnings $93,905,000 $29,250,000 $93,905,000
$153,305,000 $65,350,000
Noncontrolling interest January 1 ($42,500,000 fair value X
10%) $4,250,000
Noncontrolling interest December 31 $715,000 $4,965,000
$70,400,000 $70,400,000 $171,870,000
 2. P4-10
Prepare consolidation working papers for Plastik Corporation and Seldane at and for the
year ended December 31,2009

PLASTIK CORPORATION AND SUBSIDIARY CONSOLIDATION WORKING PAPERS FOR THE YEAR
ENDED DECEMBER 31,2010 (IN THOUSANDS)
Adjustments and
Consolidated
Pelastik 80% Seldane Eliminationd
Statements
Debits Credits
Income statement
Sales $ 200 $ 110 $ 310
Income from Syn $ 17 $ 17
Cost of sales $ (80) $ (40) $ 12.5 $ (132.5)
Depreciation Expenses $ (40) $ (20) $ 5 $ (65)
Other Expenses $ (25.5) $ (10) $ 1.25 $ (36.75)
Consolidated NI $ 75.75
Noncontrolling share $ 4.25 $ (4.25)
Controlling share of NI $ 71.5 $ 40 $ 71.5
Retained Earnings
Retained Earnings - Pelastik $ 75 $ 75
Retained Earnings - Seldane $ 50 $ 50
Controlling share of NI $ 71.5 $ 40 $ 71.5
Dividends $ (40) $ (20) $ 16
$ 4 $ (40)
Retained earnings - Dec 31 $ 106.5 $ 70 $ 106.5
Balance Sheet
Cash $ 29.5 $ 30 $ 59.5
Trade receivable - net $ 28 $ 40 $ 4 $ 64
Devidends receivable $ 8 $ 8
Inventories $ 40 $ 30 $ 70
Land $ 15 $ 30 $ 45
Buildings - net $ 65 $ 70 $ 135
Equipment - net $ 200 $ 100 $ 25 $ 5 $ 320
Investment in Seldane $ 211 $ 1
$ 210
Patents $ 25 $ 1.25 $ 23.75
$ 596.5 $ 300 $ 717.25
Accounts payable $ 40 $ 50 $ 4 $ 86
Devidends payable $ 100 $ 10 $ 8 $ 102
Other Liabilities $ 50 $ 20 $ 70
Capital stock $ 300 $ 150 $ 150 $ 300
Retained earnings $ 106.5 $ 70 $ 106.5
$ 596.5 $ 300
Noncontrolling interest January 1 $ 52.5
Noncontrolling interest December 31 $ 0.25 $ 52.75
$ 302 $ 302 $ 717.25