Archives: Solution Manual
978-0078025891 Appendix C Solution Manual Part 2
Appendix C – Investments and International Operations Exercise C-8 (30 minutes) 2013 (a) Feb. 15 Short-Term Investments—HTM (A.G.) ……………..…………. 160,000 Cash …………………………………………………….… 160,000 Purchased 90-day, 10% notes. (b) Mar. 22 Long-Term Investments—AFS (Fran) …………………………. 35,850 Cash …………………………………………………….… 35,850 Purchased 700 […]
978-0078025891 Appendix C Solution Manual Part 1
Appendix C – Investments and International Operations Appendix C Investments and International Operations QUESTIONS 1. To be classified as current assets, investments must be (i) capable of being converted into cash quickly and (ii) management must intend to sell the […]
978-0078025891 Appendix C Lecture Note
Appendix C – Investments and International Operations APP C-1 Appendix C Investments and International Operations Copyright © 2015 McGraw-Hill education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw- Hill Education. Student Learning Objectives and […]
978-0078025891 Appendix B Solution Manual
Appendix B – Applying Present and Future Values © 2015 by McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. Solutions Manual, Appendix B 1 Appendix B Applying Present and Future Values […]
978-0078025891 Appendix B Lecture Note
Appendix B – Applying Present and Future Values Appendix B Applying Present and Future Values APP B-1 Copyright © 2015 McGraw-Hill education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw- Hill Education. Student Learning […]
978-0078025877 Chapter 9 Solution Manual Part 5
Chapter 9 – Consolidation Ownership Issues P9-24 (continued) b. Penn Corp. ENC Co. Consolidation Entries DR CR Consolidated Income Statement Sales 280,000 170,000 450,000 Less: COGS (210,000) (100,000) (310,000) Less: Depreciation Expense (20,000) (15,000) (35,000) Less: Other Expenses (21,000) (25,000) […]
978-0078025877 Chapter 9 Solution Manual Part 4
Chapter 9 – Consolidation Ownership Issues P9-21 (continued) g. Consolidation entries: Basic Consolidation Entry: Preferred Stock 200,000 Premium on Preferred Stock 5,000 Common Stock 500,000 Additional Paid-In Capital 797,600 Retained Earnings 1,650,000 Income from Jacobs Jacuzzi 156,000 Dividends Income—Preferred 8,000 […]
978-0078025877 Chapter 9 Solution Manual Part 3
Chapter 9 – Consolidation Ownership Issues E9-16 Sale of Shares by Subsidiary to Nonaffiliate a. Computation of change in book value of Schroeder Corporation shares held by Browne Corporation: Before After Sale Sale Common stock, $10 par value $150,000 $ […]
978-0078025877 Chapter 9 Solution Manual Part 2
Chapter 9 – Consolidation Ownership Issues E9-8 Multilevel Ownership a. Consolidated net income for 20X6 is $190,000 ($90,000 + $40,000 + $60,000) b. Income of $36,800 is assigned to the noncontrolling interest: Income from Dally ($40,000 x 0.35) $14,000 Income […]
978-0078025877 Chapter 9 Solution Manual Part 1
Chapter 9 – Consolidation Ownership Issues CHAPTER 9 CONSOLIDATION OWNERSHIP ISSUES ANSWERS TO QUESTIONS Q9-1 Preferred stock of the subsidiary is eliminated in the consolidation process in a manner comparable to that used in eliminating the common stock of the […]
978-0078025877 Chapter 9 Lecture Note Part 2
Chapter 09 – CONSOLIDATION OWNERSHIP ISSUES 9-7 DESCRIPTIONS OF CASES, EXERCISES, AND PROBLEMS C9-1 LO 9-1 15 min. E Effect of Subsidiary Preferred Stock A number of things must be known about subsidiary preferred shares outstanding before their impact on […]
978-0078025877 Chapter 9 Lecture Note Part 1
Chapter 09 – CONSOLIDATION OWNERSHIP ISSUES CHAPTER 9 CONSOLIDATION OWNERSHIP ISSUES OVERVIEW OF CHAPTER The illustrations and discussions in Chapter 9 are intended to provide students with a basic understanding of some of the consolidation issues and problems arising from […]
978-0078025877 Chapter 8 Solution Manual Part 15
Chapter 08 – Intercompany Indebtedness P8–29B (continued) Impairment Loss Goodwill Impairment Loss 25,000 Goodwill 25,000 NCI’s Portion of Impairment Loss NCI in NA of Bussman Corp. 2,500 NCI in NI of Bussman Corp. 2,500 Copyright © 2016 by McGraw-Hill Education. […]
978-0078025877 Chapter 8 Solution Manual Part 14
Chapter 08 – Intercompany Indebtedness P8–28A (continued) Excess Value (Differential) Calculations: NCI 10% + Topp Co. 90% = Land + Goodwill Beginning balance 8,000 72,000 30,000 50,000 Changes (2,500) (22,500) (25,000) Ending balance 5,500 49,500 30,000 25,000 Amortized Excess Value […]
978-0078025877 Chapter 8 Solution Manual Part 13
Chapter 08 – Intercompany Indebtedness P8–25A (continued) 20X7 Downstream Transactions Total = Re-sold + Ending Inventory Sales 60,000 33,000 27,000 COGS 40,000 22,000 18,000 Gross Profit 20,000 11,000 9,000 Gross Profit % 33.33% Deferral of This Year’s Unrealized Profits on […]
978-0078025877 Chapter 8 Solution Manual Part 12
Chapter 08 – Intercompany Indebtedness P8-23A (continued) Bond Consolidation Entry: Bonds Payable 50,000 Bond Premium 7,000 Investment in Brown Bonds 50,000 Gain on Bond Retirement 7,000 Tyler Brown Corp. Consolidation Entries DR CR Consolidated Income Statement Sales 400,000 200,000 600,000 […]
978-0078025877 Chapter 8 Solution Manual Part 11
Chapter 08 – Intercompany Indebtedness P8–16A (continued) d. Fern Corp. Vincent Co. Consolidation Entries DR CR Consolidated Income Statement Sales 300,000 200,000 500,000 Interest income 4,500 4,500 0 Less: Other Expenses (198,500) (161,000) 4,000 (363,500) Less: Interest Expense (27,000) (9,000) […]
978-0078025877 Chapter 8 Solution Manual Part 10
Chapter 08 – Intercompany Indebtedness E8–12A (continued) e. Consolidation entries, December 31, 20X7: Bonds Payable 200,000 Premium on Bonds Payable 4,000 Interest Income 23,200 Investment in Bundle Company Bonds 194,000 Interest Expense 21,200 Investment in Bundle Co. 8,400 NCI in […]
978-0078025877 Chapter 8 Solution Manual Part 9
Chapter 08 – Intercompany Indebtedness P8-28 (continued) Eliminate Intercompany Holding of Bussman Bonds: Bonds Payable 1,000,00 0 Premium on Bonds Payable 4,268 Other Income (Interest) 124,121 Investment in Bussman Bonds 984,121 Gain on Retirement of Bonds 25,394 Other Expenses (Interest) […]
978-0078025877 Chapter 8 Solution Manual Part 8
Chapter 08 – Intercompany Indebtedness P8–26 (continued) Accumulated Depreciation 1,500 Depreciation Expense 1,500 Eliminate the Gain on Land: Investment in Skate Co. Stock 9,750 NCI in NA of Skate Co. Stock 3,250 Land 13,000 Copyright © 2016 by McGraw-Hill Education. […]
978-0078025877 Chapter 8 Solution Manual Part 7
Chapter 08 – Intercompany Indebtedness P8-24 Consolidation Worksheet — Year after Retirement a. Book Value Calculations: NCI 40% + Bennett Corp. 60% = Common Stock + Retained Earnings Beginning Book Value 68,000 102,000 100,000 70,000 + Net Income 20,000 30,000 […]
978-0078025877 Chapter 8 Solution Manual Part 6
Chapter 08 – Intercompany Indebtedness P8-20 (continued) Bond and other Debt Consolidation Entries: Bonds Payable 100,000 Bond Premium 13,246 Investment in Stang Bonds 101,607 Investment in Stang Stock 9,311 NCI in NA of Stang 2,328 Note: Interest revenue and expense […]
978-0078025877 Chapter 8 Solution Manual Part 5
Chapter 08 – Intercompany Indebtedness P8–16 (continued) c. Book Value Calculations: NCI 30% + Fern Corp. 70% = Common Stock + Retained Earnings Beginning Book Value 45,202 105,470 50,000 100,672 + Net Income 9,071 21,165 30,236 – Dividends (3,000) (7,000) […]
978-0078025877 Chapter 8 Solution Manual Part 4
Chapter 08 – Intercompany Indebtedness E8–12 (continued) d. Consolidation entries, December 31, 20X6: Bonds Payable 200,000 Premium on Bonds Payable 5,718 Interest Income 11,415 Investment in Bundle Company Bonds 192,615 Interest Expense 10,662 Gain on Bond Retirement 13,856 Eliminate intercompany […]
978-0078025877 Chapter 8 Solution Manual Part 3
Chapter 08 – Intercompany Indebtedness E8-8 Constructive Retirement at Beginning of Year 576,000.00 579,200.00 3,200.00 Face Value of Bonds PMT # Interest $ PMT Interest Income Amort of Discount (Premium) Premium (Discount) Bonds Payable BV of Bonds 400,000.00 1/1/20X5 ($3,200.00) […]
978-0078025877 Chapter 8 Solution Manual Part 2
Chapter 08 – Intercompany Indebtedness E8-3 Bond Sale at Discount a. $16,731 = ($25,073.73 + $25,119.36) x 1/3 b. Journal entries recorded by Wood Corporation: January 1, 20X4 Cash 16,000 Interest Receivable 16,000 July 1, 20X4 Cash 16,000 Investment in […]
978-0078025877 Chapter 8 Solution Manual Part 1
Chapter 08 – Intercompany Indebtedness Copyright © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or […]
978-0078025877 Chapter 8 Lecture Note Part 2
Chapter 08 – INTERCOMPANY INDEBTEDNESS 8-9 E8-9A LO 8-3 15 min. M Retirement of Bonds Sold at a Discount (Straight-Line Method) Parent company bonds issued at a discount are purchased by a subsidiary from a nonaffiliate seven years after the […]
978-0078025877 Chapter 8 Lecture Note Part 1
Chapter 08 – INTERCOMPANY INDEBTEDNESS CHAPTER 8 INTERCOMPANY INDEBTEDNESS OVERVIEW OF CHAPTER Chapter 8 illustrates the consolidation procedures needed to eliminate the financial statement effects of direct and indirect intercorporate debt transfers. Elimination of direct sale of bonds between the […]
978-0078025877 Chapter 7 Solution Manual Part 7
Chapter 07 – Intercompany Transfers of Noncurrent Assets and Services d. Rossman Corp. Schmid Dist. Consolidation Entries DR CR Consolidated Income Statement Sales 4,801,000 985,000 5,786,000 Other Income or Loss 90,000 (35,000) 80,000 40,000 15,000 Less: COGS (2,193,000) (525,000) (2,718,000) […]
978-0078025877 Chapter 7 Solution Manual Part 6
Chapter 07 – Intercompany Transfers of Noncurrent Assets and Services P7–35 (continued) Adjustments to Basic Consolidation Entry: NCI Topp Corp. Net Income 9,000 21,000 – Gain on Equip (Up) (2,880) (6,720) +Extra Depreciation (Up) 360 840 Income to be eliminated […]
978-0078025877 Chapter 7 Solution Manual Part 5
Chapter 07 – Intercompany Transfers of Noncurrent Assets and Services P7-32 (continued) c. Prime Company and Subsidiary Consolidated Balance Sheet December 31, 20X6 Cash and Receivables $ 141,000 Inventory 350,000 Land 150,000 Buildings and Equipment $655,000 Less: Accumulated Depreciation (273,000) […]
978-0078025877 Chapter 7 Solution Manual Part 4
Chapter 07 – Intercompany Transfers of Noncurrent Assets and Services P7–25 (continued) b. Consolidated net income for 20X4 is $304,000: Bold Corporation’s operating income $234,000 Toll Corporation’s net income 94,400 Amortization of differential ($44,000 / 10 years) (4,400) Unrealized profit […]
978-0078025877 Chapter 7 Solution Manual Part 3
Chapter 07 – Intercompany Transfers of Noncurrent Assets and Services E7-16 Intercompany Sale at a Loss a. Consolidated net income for 20X8 will be greater than Parent Company’s income from operations plus Sunway’s reported net income. The consolidation entries at […]
978-0078025877 Chapter 7 Solution Manual Part 2
Chapter 07 – Intercompany Transfers of Noncurrent Assets and Services E7-2 (continued) 5. b – Reported net income of Gold Company $ 45,000 Reported gain on sale of equipment $15,000 Intercompany profit realized in 20X6 (5,000) (10,000) Realized net income […]
978-0078025877 Chapter 7 Solution Manual Part 1
Chapter 07 – Intercompany Transfers of Noncurrent Assets and Services Copyright © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, […]
978-0078025877 Chapter 7 Lecture Note Part 2
Chapter 7 – INTERCOMPANY TRANSFERS OF SERVICES AND NONCURRENT ASSETS 7-8 E7-1 LO 7-5, LO 7-6 15 min. E Multiple-Choice Questions on Intercompany Transfers [AICPA Adapted] Five questions relating to the elimination of unrealized profits on intercorporate transfers and the […]
978-0078025877 Chapter 7 Lecture Note Part 1
Chapter 7 – Intercompany Transfers of Services and Noncurrent Assets CHAPTER 7 INTERCOMPANY TRANSFERS OF SERVICES AND NONCURRENT ASSETS OVERVIEW OF CHAPTER Chapter 7 focuses on the elimination of the effects of transfers of services and noncurrent assets between companies […]
978-0078025877 Chapter 6 Solution Manual Part 9
Chapter 06 – Intercompany Inventory Transactions P6-34 (continued) Randall Corp. Sharp Co. Consolidation Entries DR CR Consolidated Income Statement Sales 500,000 250,000 57,000 693,000 Other Income 20,400 30,000 50,400 Less: COGS (416,000) (202,000) 10,000 (564,000) 44,000 Less: Depreciation & Amortization […]
978-0078025877 Chapter 6 Solution Manual Part 8
Chapter 06 – Intercompany Inventory Transactions P6-32 (continued) Pine Corp. Slim Corp. Consolidation Entries DR CR Consolidated Balance Sheet Cash 105,000 15,000 120,000 AR & Other Receivables 410,000 120,000 900 334,100 90,000 100,000 5,000 Merchandise Inventory 920,000 670,000 3,000 1,587,000 […]
978-0078025877 Chapter 6 Solution Manual Part 7
Chapter 06 – Intercompany Inventory Transactions P6-30 Consolidation Using Financial Statement Data a. Equity Method Entries on Bower Corp.’s Books: Investment in Concerto Co. 21,000 Income from Concerto Co. 21,000 Record Bower Corp.’s 60% share of Concerto Co.’s 20X6 income […]
978-0078025877 Chapter 6 Solution Manual Part 6
Chapter 06 – Intercompany Inventory Transactions P6-27 (continued) 20X9 Downstream Transactions Total = Re-sold + Ending Inventory Sales 90,000 70,000 20,000 COGS 54,000 42,000 12,000 Gross Profit 36,000 28,000 8,000 Gross Profit % 40.00% 20X9 Upstream Transactions Total = Re-sold […]
978-0078025877 Chapter 6 Solution Manual Part 5
Chapter 06 – Intercompany Inventory Transactions P6–24 (continued) Adjustment to Basic Consolidation Entry NCI Priority Net Income 9,000 81,000 +Reverse GP deferral (down) 8,000 +Reverse GP deferral (up) 600 5,400 – Gross profit deferral (down) (2,000) – Gross profit deferral […]
978-0078025877 Chapter 6 Solution Manual Part 4
Chapter 06 – Intercompany Inventory Transactions P6-21 Incomplete Data a. Increase in fair value of buildings and equipment: Consolidated total $ 680,000 Balance reported by Lever (400,000) Balance reported by Tropic (240,000) Increase in value $ 40,000 b. Accumulated depreciation […]
978-0078025877 Chapter 6 Solution Manual Part 3
Chapter 06 – Intercompany Inventory Transactions E6-13 Consolidated Balance Sheet Worksheet a. Equity Method Entries on Doorst Corp.’s Books: Investment in Hingle Co. 49,000 Income from Hingle Co. 49,000 Record Doorst Corp.’s 70% share of Hingle Co.’s 20X8 income Cash […]
978-0078025877 Chapter 6 Solution Manual Part 2
Chapter 06 – Intercompany Inventory Transactions 6. b – 14 years = ($28,000 / [(28,000 – $20,000) / 4 years] E6-3 Multiple Choice – Consolidated Income Statement 1. c – The only sales recorded are sales to non-affiliates. 2. b […]
978-0078025877 Chapter 6 Solution Manual Part 1
Chapter 06 – Intercompany Inventory Transactions CHAPTER 6 INTERCOMPANY INVENTORY TRANSACTIONS ANSWERS TO QUESTIONS Q6-1 All inventory transfers between related companies must be eliminated to avoid an overstatement of revenue and cost of goods sold in the consolidated income statement. […]
978-0078025877 Chapter 6 Lecture Note Part 2
Chapter 06 – INTERCOMPANY INVENTORY TRANSACTIONS 6-8 E6-1 LO 6-3, LO 6-4 15 min. E Multiple-Choice Questions on Intercompany Inventory Transfers [AICPA Adapted] Six multiple-choice questions cover issues associated with the valuation of inventory and determination of consolidated net income […]
978-0078025877 Chapter 6 Lecture Note Part 1
Chapter 06 – INTERCOMPANY INVENTORY TRANSACTIONS CHAPTER 6 INTERCOMPANY INVENTORY TRANSACTIONS OVERVIEW OF CHAPTER Chapters 6 and 7 focus on the elimination of the effects of transfers of assets and services between companies included in a consolidated entity. The procedures […]
978-0078025877 Chapter 5 Solution Manual Part 8
Chapter 05 – Consolidation of Less-Than-Wholly Owned Subsidiaries Acquired at More than Book Value P5–37 Subsidiary with Other Comprehensive Income in Year of Acquisition a. Equity Method Entries on Amber Corp.’s Books: Investment in Sparta Co. 96,000 Cash 96,000 Record […]