2 Cash and Accounts ReceivableInventoryBuildings and Equipment (net)Investment in Spark Filter CompanyCost of Goods SoldDepreciation ExpenseCurrent LiabilitiesCommon StockRetained EarningsSalesIncome from Spark Filter CompanyTotal¡✓view transaction listNoABCEntry12On January 1, 20x8, Plug's inventory contained filters purchased for $75,000 from Spark Filter, which had produced the filters for$55,000. In 20x8. Spark Filter spent $115,000 to produce additional filters, which it sold to Plug for $156,818. By December 31, 20X8.Plug had sold all filters that had been on hand January 1, 20X8, but continued to hold in inventory $47,045 of the 20X8 purchase fromSpark Filter.3Required:a. Prepare all consolidation entries needed to complete a consolidation worksheet for 20X8.Note: If no entry is required for a transaction/event, select "No Journal entry required" In the first account field.transaction listNoncontrolling interestCommon stockRetained earningsPlug ProductsCredit$ 162,000224,000281,000278,618167,00035,000Sales$1,147,618Cost of goods soldInventoryIncome from Spark Filter CompanyNCI in Net Income of Spark Filter CompanyNCI in Net assets of Spark Filter CompanyInvestment in Spark Filter CompanyConsolidated net incomeIncome assigned to the controlling interestInvestment in Spark Filter CompanyNCI in Net assets of Spark Filter CompanyCost of goods soldAccountsDebit$ 142,089$ 127.635$ 159,982195,000463,000271,81857,818$1,147,618Spark Filter CompanyCreditDebit$ 97,000126,000182,000132,00025,000$ 562,000Debit80,000216,00057,81814,454$44,18280,000216,000221,81816,0004,000$ 562,000156,818Creditb. Compute consolidated net income and income assigned to the controlling interest in the 20x8 consolidated income statement.c. Compute the balance assigned to the noncontrolling interest in the consolidated balance sheet as of December 31, 20X8.294,61773.65420,000144,27112,547XThe answers highlighted in yellow are incorrect.A Record the basic consolidation entry.B Record the entry to reverse last year's deferral.Record the entry to defer the current year's unrealizedprofits on inventory transfers.Note:= journal entry has been enteredX

Consolidation is an activity in which financial statements of a parent and its subsidiary should be…

Cash and Accounts Receivable Inventory Buildings and Equipment (net) Investment in Spark Filter Company Cost of Goods Sold Depreciation Expense Current Liabilities Common Stock Retained Earnings Sales Income from Spark Filter Company Total Plug Products Credit $ 162,000 224,000 281,000 278,618 167,000 35,000 $1,147,618 Debit $ 159,982 195,000 463,000 271,818 57,818 $ 1,147,618 Spark Filter Company Credit Debit $ 97,000 126,000 182,000 132,000 25,000 $ 562,000 $ 44,182 80,000 216,000 221,818 $ 562,000 On January 1, 20X8, Plug's inventory contained filters purchased for $75,000 from Spark Filter, which had produced the filters for $55,000. In 20X8. Spark Filter spent $115,000 to produce additional filters, which it sold to Plug for $156,818. By December 31, 20X8. Plug had sold all filters that had been on hand January 1, 20X8, but continued to hold in inventory $47.045 of the 20X8 purchase from Spark Filter.

Cash and Accounts Receivable Inventory Buildings and Equipment (net) Investment in Spark Filter Company Cost of Goods Sold Depreciation Expense Current Liabilities Common Stock Retained Earnings Sales Income from Spark Filter Company Total Plug Products Credit $ 162,000 224,000 281,000 278,618 167,000 35,000 $1,147,618 Debit $ 159,982 195,000 463,000 271,818 57,818 $ 1,147,618 Spark Filter Company Credit Debit $ 97,000 126,000 182,000 132,000 25,000 $ 562,000 $ 44,182 80,000 216,000 221,818 $ 562,000 On January 1, 20X8, Plug's inventory contained filters purchased for $75,000 from Spark Filter, which had produced the filters for $55,000. In 20X8. Spark Filter spent $115,000 to produce additional filters, which it sold to Plug for $156,818. By December 31, 20X8. Plug had sold all filters that had been on hand January 1, 20X8, but continued to hold in inventory $47.045 of the 20X8 purchase from Spark Filter.

Financial Accounting: The Impact on Decision Makers

10th Edition

ISBN:9781305654174

Author:Gary A. Porter, Curtis L. Norton

Publisher:Gary A. Porter, Curtis L. Norton

Chapter12: The Statement Of Cash Flows

Section: Chapter Questions

Problem 12.10E

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