Puddle Corporation Acquired All the Voting Stock of Soggi Company

question 36

Essay

Puddle Corporation acquired all the voting stock of Soggi Company for $500,000 on January 1,2011 when Soggi had Capital Stock of $300,000 and Retained Earnings of $150,000.The book value of Soggi's assets and liabilities were equal to the fair value except for the plant assets.The entire cost-book value differential is allocated to plant assets and is fully depreciated on a straight-line basis over a 10-year period.
During 2011,Puddle borrowed $25,000 on a short-term non-interest-bearing note from Soggi,and on December 31,2011,Puddle mailed a check to Soggi to settle the note.Soggi deposited the check on January 5,2012,but receipt of payment of the note was not reflected in Soggi's December 31,2011 balance sheet.
Required:
Complete the consolidation working papers for the year ended December 31,2011.

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