Reference no: EM132539804

Pop Company acquired all of Soda Corporation's common shares on January 2, 20X3, for $849,000. At the date of combination, Soda's balance sheet appeared as follows:

 Assets                                                               Liabilities

Cash & Receivables $42,000                          Current Payables $33,000

Inventory 184,000                                            Notes Payable 92,000

Land             68,000                                        Stockholders' Equity Buildings (net) 255,000

Common Stock 199,000                                     Equipment (net) 326,000

Additional Capital    420,000                                Retained Earnings 131,000

Total $875,000                                             Total $875,000

• The fair values of all of Soda's assets and liabilities were equal to their book values except for its fixed assets. Soda's land had a fair value of $83,000; the buildings, a fair value of $319,000; and the equipment, a fair value of $346,000.
• Pop Company decided to employ push-down accounting for the acquisition of Soda Corporation. Subsequent to the combination, Soda continued to operate as a separate company.

Required:

Question a. Record the acquisition of Soda's stock on Pop's books. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Question b. RECORD any entries that would be made on Soda's books related to the business combination, assuming push-down accounting is used. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Question c. RECORD all consolidation entries that would appear in a consolidation worksheet for Pop Company and its subsidiary prepared immediately following the combination.(If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)