Post Delivery Service acquired at book value 80 percent of the voting shares of Script Real Estate Company. On that date, the fair value of the noncontrolling interest was equal to 20 percent of Script's book value. Script Real Estate reported common stock of $400,000 and retained earings of $10,000, During 20X3, Post Delivery provided counter services for Script Real Estate In the amount of $15,000. Also during 20X3, Script Real Estate purchased land for $1,000 it sold the land to Post Delivery Service for $21,000 so that Post Delivery could build a new transportation center Post Delivery reported $57,000 of operating income from its delivery operations In 20X3. Script Real Estate reported net Income of $63,000 and paid dividends of $9,000 in 20X3. Required: a. Compute consolidated net income for 2013, Consolidated net income b. Prepare all journal entries recorded by Post Delivery Service related to its investment in Script Real Estate assuming Post uses the fully adjusted equity method in accounting for the investment Note: If no entry is required for a transaction/event, select "No journal entry required in the first account field. Vw transaction Bat Journal entry worksheet < A B C Record the dividends from Script Real Estate Note: Enter debits before creats Event General Journal Clearany Debit Credit View pinaral journal
Post Delivery Service acquired at book value 80 percent of the voting shares of Script Real Estate Company. On that date, the fair value of the noncontrolling interest was equal to 20 percent of Script's book value. Script Real Estate reported common stock of $400,000 and retained earings of $10,000, During 20X3, Post Delivery provided counter services for Script Real Estate In the amount of $15,000. Also during 20X3, Script Real Estate purchased land for $1,000 it sold the land to Post Delivery Service for $21,000 so that Post Delivery could build a new transportation center Post Delivery reported $57,000 of operating income from its delivery operations In 20X3. Script Real Estate reported net Income of $63,000 and paid dividends of $9,000 in 20X3. Required: a. Compute consolidated net income for 2013, Consolidated net income b. Prepare all journal entries recorded by Post Delivery Service related to its investment in Script Real Estate assuming Post uses the fully adjusted equity method in accounting for the investment Note: If no entry is required for a transaction/event, select "No journal entry required in the first account field. Vw transaction Bat Journal entry worksheet < A B C Record the dividends from Script Real Estate Note: Enter debits before creats Event General Journal Clearany Debit Credit View pinaral journal
Chapter8: Consolidated Tax Returns
Section: Chapter Questions
Problem 36P
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Transcribed Image Text:Post Delivery Service acquired at book value 80 percent of the voting shares of Script Real Estate Company. On that date, the fair
value of the noncontrolling Interest was equal to 20 percent of Script's book value. Script Real Estate reported common stock of
$400,000 and retained earnings of $110,000, During 20X3, Post Delivery provided counter services for Script Real Estate In the amount
of $15,000. Also during 20X3, Script Real Estate purchased land for $1,000. It sold the land to Post Delivery Service for $21,000 so that
Post Delivery could build a new transportation center, Post Delivery reported $57,000 of operating Income from its delivery operations
In 20X3. Script Real Estate reported net Income of $63,000 and paid dividends of $9,000 in 20X3.
Required:
a. Compute consolidated net income for 20X3,
Consolidated net income
b. Prepare all Journal entries recorded by Post Delivery Service related to its Investment in Script Real Estate assuming Post uses the
fully adjusted equity method in accounting for the Investment
Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
View transaction st
Journal entry worksheet
<
A
Record the dividends from Script Real Estate
B C
Note: Enter debits before credits
Event
Racord entry
view transaction Ba
<
Consolidation
Worksheet Entries
General Journal
C
Clear entry
c. Prepare all consolidation entries required in preparing a consolidation worksheet as of December 31, 2013
Note: If no entry is required for a transaction/event, select "No journal entry required in the first account field
Debit
Record the basic consolidation entry
Credit
View genaral journal
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