Matthews Co

question 23

Essay

Matthews Co.acquired all of the common stock of Jackson Co.on January 1,2010.As of that date,Jackson had the following trial balance:
During 2010,Jackson reported net income of $96,000 while paying dividends of $12,000.During 2011,Jackson reported net income of $132,000 while paying dividends of $36,000.
Assume that Matthews Co.acquired the common stock of Jackson Co.for $588,000 in cash.As of January 1,2010,Jackson's land had a fair value of $102,000,its buildings were valued at $188,000,and its equipment was appraised at $216,000.Any excess of consideration transferred over fair value of assets and liabilities acquired is due to an unamortized patent to be amortized over 10 years.
Matthews decided to use the equity method for this investment.
Required:
(A. )Prepare consolidation worksheet entries for December 31,2010.
(B. )Prepare consolidation worksheet entries for December 31,2011.
$\begin{array}{c}\begin{array}{lll}\\ \text {Accounts payable}\\ \text {Accounts receivable}\\ \text {Additional paid-in capital}\\ \text {Buildings-net (20-year life)}\\ \text {Cash and short-term investments}\\ \text {Common stock}\\ \text {Equipment-net (8-year life)}\\ \text {Inventory}\\ \text {Land}\\ \text {Long-term liabilities (mature 12/31/12)}\\ \text {Retained earnings, 1/1/10}\\ \text {Supplies}\\ \text {Totals}\end{array}\begin{array}{lll}\underline{\text {Debit}}\\\\\$ 50,000 \\\\140.000\\70,000\\\\240,000\\110.000\\90,000\\\\\\\underline{20.000}\\\underline{\underline{\$ 720.000}} \end{array}\begin{array}{r}\underline{\text { Credit }}\\\$ 60,000 \\\\60,000 \\\\\\300,000 \\\\\\\\180,000 \\120,000 \\\underline{\quad\quad}\\\underline{\underline{ \$ 720,000}} \\ \end{array}\end{array}$

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Definitions:

Syllogisms

Syllogisms are a form of deductive reasoning consisting of a major premise, a minor premise, and a conclusion, where the conclusion logically follows from the two premises.

Syllogisms

Logical structures that use deductive reasoning to come to a conclusion based on two or more propositions that are asserted as true, highlighting the relationship between different sets of items.

Extended Argument

A complex argument that involves a series of premises leading to a conclusion, often spanning a significant portion of a discourse or text.

Syllogistic Steps

The sequences in a syllogism, typically involving three steps: two premises and a conclusion that are connected logically.