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What journal entries are required in pops pre-consolidation

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Point 1: On January 1, 2019, Pops acquired 90% of Son's outstanding common stock in exchange for 10,000 shares of Pops common stock ($10 par value). Pops Corp's common stock has a $13.50 per share fair value at the date of the transaction. Assume that immediately preceding the acquisition by Pops, Son, Inc. had 4,500 shares of common stock outstanding and it was trading at $33 per share.

Point 2: On January 1, 2019, Pops contracts with the selling Son stockholders to issue 1,000 additional shares of Pops' common stock on April 10, 2020 if fiscal year-end December 31, 2019 consolidated income is greater than $1 million. At the acquisition date, the fair value of this contingent-payment provision is $9,000.

Point 3: Assume that fiscal year-end December 31, 2019 consolidated net income is $1.5 million and that on April 10, 2020 the market value of Pops' common stock is $18 per share.

Question 1: What journal entries are required in Pop's pre-consolidation accounting records at January 1, 2019; December 31, 2019 and April 10, 2020?

Reference no: EM132478926

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