The Stockholders' Equity Section of Ernesto Corporation's Balance Sheet Appeared

question 140

Essay

The stockholders' equity section of Ernesto Corporation's balance sheet appeared as follows on December 31,2010:
$$\begin{array} { |l | r| } \hline \text { Common Stock } & \$150,000 \\\text { Retained Earnings } & 75,000 \\\text { Total Stackholders' Equity } &\$225,000 \\\hline\end{array}$$ Prepare entries in journal form to eliminate Brody's investment in Ernesto and Ernesto's stockholders' equity used in preparing the consolidated balance sheet under each of the following assumptions.(Omit explanations.)
a. Brody purchased 100 percent of Ernesto for $225,000.
b. Brody purchased 100 percent of Ernesto for $250,000. The excess did not apply to any particular asset.
c. Brody purchased 80 percent of Ernesto for $180,000.

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Definitions:

Relational Aggression

A form of aggression that involves harming others through deliberate manipulation of their social standing and relationships.

Social Standing

The position or rank of an individual or group within the social hierarchy, often influenced by factors such as wealth, occupation, and education.

Gender Typing

The process by which a child becomes aware of their gender and thus behaves accordingly by adopting values and attributes of members of the sex that they identify as.

Secondary Sex Characteristics

Physical features that emerge during puberty which are not directly involved in reproduction but distinguish the two sexes, such as facial hair in males and breast development in females.