Prepare the elimination entires

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Reference no: EM132218467

Question: 1/1/2009 Plymouth acquired 60% interest in Sander in exchange for various considerations totaling $570,000. At the acquisition date,

NCI's FV: $380,000

Sander's BV: $850,000

Sander had developed internally a customer list that was not recorded on its books but had an acquisition-date fair value of $100,000. This intangible asset is being amortized over 20 years.

Plymouth sold Sander land with a book value of $60,000 on Jan. 2, 2009, for $100,000. Sander still holds this land at the end of the current year.

Sander regularly transfers inventory to Plymouth. In 2009, it shipped inventory costing $100,000 to Plymouth at a price of $150,000. During 2010, intercompany shipments totaled $200,000, although the original cost to Sander was only $140,000. In each of these years, 20% of the merchandise was not resold to outside parties until the period following the transfer.

Plymouth uses the partial equity method. Plymouth owes Sander $40,000 at the end of 2010.

A) Prepare the elimination entires needed to complete a consolidation workpaper for 2010. Use the acquisition method to account for the non-controlling interests in Sander. Include entries such as S, A, I, D, E, P, TI, G, ED, *G, TL, *GL, and any if necessary.

Reference no: EM132218467

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