Use the following information to answer the question(s) below.
On January 1, 2014, Penelope Company acquired a 90% interest in Leah Company for $180,000 cash. On January 1, 2014, Leah Company had the following assets and liabilities:
Push-down accounting is used for the acquisition.
-On January 1, 2014, Jeff Company acquired a 90% interest in Margaret Company for $198,000 cash. On January 1, 2014, Margaret Company had the following assets and liabilities:
Push-down accounting is used for the acquisition.
Required:
1. Assume both companies use the entity theory.
a. Record the journal entry on Margaret's separate books on January 1, 2014.
b. Record the journal entry on Jeff's separate books on January 1, 2014.
2. Assume both companies use the parent company theory.
a. Record the journal entry on Margaret's separate books on January 1, 2014.
b. Record the journal entry on Jeff's separate books on January 1, 2014.

Question

Use the following information to answer the question(s) below.
On January 1, 2014, Penelope Company acquired a 90% interest in Leah Company for $180,000 cash. On January 1, 2014, Leah Company had the following assets and liabilities:
  Push-down accounting is used for the acquisition.
-On January 1, 2014, Jeff Company acquired a 90% interest in Margaret Company for $198,000 cash. On January 1, 2014, Margaret Company had the following assets and liabilities:
  Push-down accounting is used for the acquisition.
Required:
1. Assume both companies use the entity theory.
a. Record the journal entry on Margaret's separate books on January 1, 2014.
b. Record the journal entry on Jeff's separate books on January 1, 2014.
2. Assume both companies use the parent company theory.
a. Record the journal entry on Margaret's separate books on January 1, 2014.
b. Record the journal entry on Jeff's separate books on January 1, 2014.

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The Answer of Use the following information to answer the question(s) below.
On January 1, 2014, Penelope Company acquired a 90% interest in Leah Company for $180,000 cash. On January 1, 2014, Leah Company had the following assets and liabilities:
  Push-down accounting is used for the acquisition.
-On January 1, 2014, Jeff Company acquired a 90% interest in Margaret Company for $198,000 cash. On January 1, 2014, Margaret Company had the following assets and liabilities:
  Push-down accounting is used for the acquisition.
Required:
1. Assume both companies use the entity theory.
a. Record the journal entry on Margaret's separate books on January 1, 2014.
b. Record the journal entry on Jeff's separate books on January 1, 2014.
2. Assume both companies use the parent company theory.
a. Record the journal entry on Margaret's separate books on January 1, 2014.
b. Record the journal entry on Jeff's separate books on January 1, 2014.

Use the Following Information to Answer the Question(s) Below