Advanced Accounting 11th Edition by Paul Fischer,William Tayler, Rita Cheng

Exercise 44

80%, equity method worksheet, several adjustments, third year. Refer to the preceding common information for Paulcraft's acquisition of Switzer's common stock. Assume that Paulcraft pays $440,000 for 80% of Switzer common stock. Paulcraft uses the simple equity method to account for its investment in Switzer. Paulcraft and Switzer have the following trial balances on December 31, 2013:
1. Prepare a value analysis and a determination and distribution of excess schedule for the investment in Switzer.
2. Complete a consolidated worksheet for Paulcraft Corporation and its subsidiary Switzer Corporation as of December 31, 2013. Prepare supporting amortization and income distribution schedules.