Provide the required consolidation entries as of december

Reference no: EM133416809

Question 1-

Peter Architectural Services holds 100% of the voting shares of Smith Manufacturing.

Over the course of 2022, Peter provided $200,000 in architectural services associated with Smith's new manufacturing facility, which will open on January 4, 2023 and has a 10-year lifespan.

Smith capitalized the cost of architectural services as part of the cost of the building.

required:

1. Provide the required consolidation entries as of December 31, 2022 to eliminate the effects of this transaction in the 2022 consolidated financial statements.

2. Provide the required consolidation entries as of December 31, 2023 to eliminate the effects of this transaction in the 2023 consolidated financial statements.

Question 2

Maria, Inc. owns 100% of the voting shares of Sara, Inc.

On 12/31/2021, Maria bought Sara's $500,000 par value bonds for $480,000 in the market. The bonds were acquired in the secondary market from other bondholders.

Sara had sold these bonds several years ago on the market for $570,000. As of 12/31/2021 Sara's balance in the Unamortized Bond Premium account was $40,000.

Required:

Prepare all the necessary consolidation entries to prepare the consolidated statements.

Reference no: EM133416809

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