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    A. Prepare On Pruin Company's Books Journal Entries To Record The Investment Related Activities For 2020

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    Pruin Corporation acquired Satto Corporation on January 1, 2019 for $210,000. In 2020, Pruin accounted for its investment in Satto using the partial equity method. Financial statements for both companies as of December 31, 2020 are provided, along with a consolidated statements workpaper requiring elimination entries and completion of consolidated balances.

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    A. Prepare On Pruin Company's Books Journal Entries To Record The Investment Related Activities For 2020

    Uploaded by

    sameer
    40 views2 pages
    Pruin Corporation acquired Satto Corporation on January 1, 2019 for $210,000. In 2020, Pruin accounted for its investment in Satto using the partial equity method. Financial statements for both companies as of December 31, 2020 are provided, along with a consolidated statements workpaper requiring elimination entries and completion of consolidated balances.

    Original Title

    Advanced Accounting -H

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    Pruin Corporation acquired Satto Corporation on January 1, 2019 for $210,000. In 2020, Pruin accounted for its investment in Satto using the partial equity method. Financial statements for both companies as of December 31, 2020 are provided, along with a consolidated statements workpaper requiring elimination entries and completion of consolidated balances.

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    © All Rights Reserved
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    Download as docx, pdf, or txt
    40 views2 pages

    A. Prepare On Pruin Company's Books Journal Entries To Record The Investment Related Activities For 2020

    Uploaded by

    sameer
    Pruin Corporation acquired Satto Corporation on January 1, 2019 for $210,000. In 2020, Pruin accounted for its investment in Satto using the partial equity method. Financial statements for both companies as of December 31, 2020 are provided, along with a consolidated statements workpaper requiring elimination entries and completion of consolidated balances.

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    Advanced Accounting

    Homework (10 points) due Dec. 20, 2020

    Student Name ----------------------------------------------------- # --------------------------------

    Pruin Corporation acquired all of the voting stock of Satto Corporation on January 1, 2019, for $210,000
    when Satto had common stock of $150,000 and retained earnings of $24,000. The excess of implied over
    book value was allocated $9,000 to inventories that were sold in 2019, $12,000 to equipment with a 4-
    year remaining useful life under the straight-line method, and the remainder to goodwill.

    Financial statements for Pruitt and Satto Corporations at the end of the fiscal year ended December 31,
    2020 (two years after acquisition), appear in the first two columns of the partially completed consolidated
    statements workpaper. Pruin Corp. has accounted for its investment in Satto using the partial equity
    method of accounting.

    Required:
    A. Prepare on Pruin Company’s books journal entries to record the investment related
    activities for 2020.

    B. Prepare, in general journal form, the workpaper eliminating entries necessary in the consolidated
    statements workpaper for the year ending December 31, 2020.

    C, Complete the consolidated statements workpaper for Pruin Corporation and Satto Corporation for
    December 31, 2020.
    Pruin Corporation and Satto Corporation
    Consolidated Statements Workpaper
    at December 31, 2020

    Eliminations
    Pruin Satto Consolidated
    Debit Credit
    Corp. Corp. Balances
    INCOME
    STATEMENT
    Sales 618,000 180,000
    Equity from Subsidiary
    Income 36,000
    Cost of Sales (450,000) (90,000)
    (114,000
    Other Expenses ) (54,000)
    Net Income to Ret. Earn. 90,000 36,000
    Pruin Retained Earnings
    1/1 72,000
    Soto Retained Earnings
    1/1 3,000
    Add: Net Income 90,000 36,000
    Less: Dividends (60,000) (12,000)
    Retained Earnings 12/31 102,000 54,000
    BALANCE SHEET
    Cash 42,000 21,000
    Inventories 63,000 45,000
    Land 33,000 18,000
    Equipment and
    Buildings-net 192,000 165,000
    Investment in Satto
    Corp. 240,000
    Total Assets 570,000 249,000
    LIA & EQUITIES
    Liabilities 168,000 45,000
    Common Stock 300,000 150,000
    Retained Earnings 102,000 54,000
    Total Equities 570,000 249,000

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