Question

Peanut Company acquired 100 percent of Snoopy Company's outstanding common stock for $305,000 on January 1, 20X8, when the book value of Snoopy's net assets was equal to $305,000. Peanut chooses to carry the investment in Snoopy at cost because the investment will be consolidated. Trial balance data for Peanut and Snoopy as of December 31, 20X8. are as follows: $ Snoopy Company Debit Credit $ 75,000 71,000 86,000 References Cash Accounts Receivable Inventory Investment in Snoopy Company Land Buildings & Equipment Cost of Goods Sold Depreciation Expense Selling & Administrative Expense Dividends Declared Accumulated Depreciation Accounts Payable Bonds Payable Common Stock Peanut Company Debit Credit 232,000 201,000 193,000 305,000 209,000 718,000 273,000 56,000 244,000 111,000 437,000 70,000 187,000 487.000 81,000 180,000 130,000 19,000 53,000 24,000 $ 38,000 55,000 65,000 217.000

Answer 1

Sowtion Preparation of the Journal entries on Peanuts book's for the acquisition of shooly on January 1, 2008 investment in Snoopy A recording of the initial Company Date Account's title and explanation Debit credit 3,05.000 investment in snoopy co 3,05.000 cash (To record the initial Investment in Snoopy co., )

($) C ) ® Recording of Peanut co., 100% share of shoopy Co., s 2018 Income Date Account title and explanation Debit credit Investment in shooly Co., 24.000 Income from Snoolyco 24.000 (dividend) [To recard Peanut Co. 100% Share of snoopy co.,s 2008 Income]

© Recording Peanut co;'s 100% share of shoopy cois 2008 dividend Date Account title and Debit credite explanation 24.000 cash Alc 24,000 incestment in shooly inc, [To record Peanut co.'s 100% share of shoopy co's 2008 dividend]