a. Prepare the required 10 consolidation entry in 2015. Description Du Gain Land Cash 50,000 Accounts receivable 04 b. Prepare the required [] consolidation entry required at the end of each year 2016 through 2018 Description Debit Creda gain Retained earnings 50,000✔ Land Land Dan Equity in c. Assume that the parent re-sells the land outside of the consolidated group for $525,000 on December 31, 2019. Prepare the journal entry made by the parent to record the sale and the required 0 comodation entry for 2019. Description Credit Dobit 525,000 04 ✔ Cred 25,000 50,000 0✔ 50,000 500,000 25,000 x d. What will be the amount of gain reported in the consolidated income statement in 2019 $ 75,000
a. Prepare the required 10 consolidation entry in 2015. Description Du Gain Land Cash 50,000 Accounts receivable 04 b. Prepare the required [] consolidation entry required at the end of each year 2016 through 2018 Description Debit Creda gain Retained earnings 50,000✔ Land Land Dan Equity in c. Assume that the parent re-sells the land outside of the consolidated group for $525,000 on December 31, 2019. Prepare the journal entry made by the parent to record the sale and the required 0 comodation entry for 2019. Description Credit Dobit 525,000 04 ✔ Cred 25,000 50,000 0✔ 50,000 500,000 25,000 x d. What will be the amount of gain reported in the consolidated income statement in 2019 $ 75,000
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
ChapterA2: Investments
Section: Chapter Questions
Problem 30E
Related questions
Question
![Preparing the consolidation entries for sale of land
Assume that during 2015 a wholly owned subsidiary sells land that originally cost $450,000 to its parent for a sale price of $500,000. The parent holds
the land until it sells the land to an unaffiliated company on December 31, 2019. The parent uses the equity method of pre-consolidation
bookkeeping
a. Prepare the required [] consolidation entry in 2015.
Description
gain Gain on a
Cash
b. Prepare the required [] consolidation entry required at the end of each year 2016 through 2018
Description
Debit
Credit
gain Retained earnings
Land
gain Equityment
Gain on sa
Debit
x
50,000
✓
L
c. Assume that the parent re-sells the land outside of the consolidated group for $525,000 on December 31, 2019. Prepare the journal entry made by
the parent to record the sale and the required 3 consolidation entry for 2019.
Description
Credit
50,000
Debi
525,000
0✔
0✔
Credit
25,000
0✔
50,000
Dx
DU
25,000x
d. What will be the amount of gain reported in the consolidated income statement in 2017
$ 75,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F3cadaab7-0242-405d-ab75-d1a15c225b30%2Fde270ef2-7b22-4e54-8133-d90c9b1a44ab%2Fouswq5h_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Preparing the consolidation entries for sale of land
Assume that during 2015 a wholly owned subsidiary sells land that originally cost $450,000 to its parent for a sale price of $500,000. The parent holds
the land until it sells the land to an unaffiliated company on December 31, 2019. The parent uses the equity method of pre-consolidation
bookkeeping
a. Prepare the required [] consolidation entry in 2015.
Description
gain Gain on a
Cash
b. Prepare the required [] consolidation entry required at the end of each year 2016 through 2018
Description
Debit
Credit
gain Retained earnings
Land
gain Equityment
Gain on sa
Debit
x
50,000
✓
L
c. Assume that the parent re-sells the land outside of the consolidated group for $525,000 on December 31, 2019. Prepare the journal entry made by
the parent to record the sale and the required 3 consolidation entry for 2019.
Description
Credit
50,000
Debi
525,000
0✔
0✔
Credit
25,000
0✔
50,000
Dx
DU
25,000x
d. What will be the amount of gain reported in the consolidated income statement in 2017
$ 75,000
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
![Cornerstones of Financial Accounting](https://www.bartleby.com/isbn_cover_images/9781337690881/9781337690881_smallCoverImage.gif)
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
![Financial Reporting, Financial Statement Analysis…](https://www.bartleby.com/isbn_cover_images/9781285190907/9781285190907_smallCoverImage.gif)
Financial Reporting, Financial Statement Analysis…
Finance
ISBN:
9781285190907
Author:
James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher:
Cengage Learning
![Cornerstones of Financial Accounting](https://www.bartleby.com/isbn_cover_images/9781337690881/9781337690881_smallCoverImage.gif)
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
![Financial Reporting, Financial Statement Analysis…](https://www.bartleby.com/isbn_cover_images/9781285190907/9781285190907_smallCoverImage.gif)
Financial Reporting, Financial Statement Analysis…
Finance
ISBN:
9781285190907
Author:
James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher:
Cengage Learning
![Intermediate Accounting: Reporting And Analysis](https://www.bartleby.com/isbn_cover_images/9781337788281/9781337788281_smallCoverImage.jpg)
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning