Solution-Prepare the consolidation worksheet for crain and

Prepare the consolidation worksheet for crain and downey

Assignment Help Accounting Basics

Reference no: EM13868605

	Crain	Downy
	31-Dec	31-Mar	31-Dec	Last 3 Qtrs	Crain's 75%
Cash	730,000	175,000	180,000		-
Inventory	1,950,000	260,000	340,000		-
Plant and Equipment	17,650,000	5,150,000	5,765,000		-
Accumulated Depreciation	-4,655,000	-935,000	-1,250,000		-
Investment in Downey	3,886,875	-	-		-
Expenses	6,400,000	1,000,000	4,265,000	3,265,000	2,448,750
Dividends	1,275,000	150,000	250,000		-
Total Debits	27,236,875	5,800,000	9,550,000	3,265,000	2,448,750
Liabilities	3,550,000	650,000	500,000		-
Common Stock	350,000	100,000	100,000		-
Additional Paid-In Capital	2,650,000	850,000	850,000		-
Retained Earnings	9,720,000	2,800,000	2,800,000		-
Sales	10,650,000	1,400,000	5,300,000	3,900,000	2,925,000
Extraordinary Gain From acquisition of Downey	105,000	-	-	-	-
Investment Income	211,875	-	-	-	-
Total Credits	27,236,875	5,800,000	9,550,000	3,900,000	2,925,000
				-635,000	-476,250

Required:

A. Record the journal entries necessary on Crain's books for 2005 assuming that Crain uses the equity method to account for its investment in Downey.

B. Prepare all worksheet eliminations in journal entry form necessary to consolidate Crain and Downey at December 31, 2005.

C. Prepare the consolidation worksheet for Crain and Downey at December 31, 2005.

Reference no: EM13868605

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Prepare the consolidation worksheet for crain and downey

Reference no: EM13868605

Reference no: EM13868605

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