Consolidation

Question 1

Consolidation Workpaper Eliminating Journal Entry

Answer 1

DR: Common Stock - Subsidiary
DR: APIC - Subsidiary
DR: Retain Earnings - Subsidiary 
CR:  Investment in Subsidiary
CR: Noncontrolling Interest
DR: Balance sheet adjusted to fair value
DR: Identifiable intangible asset fair value
DR: Goodwill

Question 2

Eliminate 100% of Intercompany Payable and Receivables

Answer 2

DR: Accounts Payable
CR: Accounts Receivable

Question 3

Eliminate 100% of Intercompany Inventory

Answer 3

First Eliminated Sales
DR: Intercompany Sales (selling affiliate)
CR: Intercompany COGS (selling affiliate)

DR: COGS (purchasing affiliate)
CR: Inventory (purchasing affiliate)

Question 4

Eliminate 100% of Intercompany Fixed Assets

Answer 4

DR: Gain
CR: Equipment
CR: Accumulated Depreciation

DR: Accumulated Depreciation
CR: Depreciation Expense (RE)

Question 5

Eliminate 100% of Intercompany Bonds

Answer 5

DR: Bond Interest Payable
CR: Bond Interest Receivable

DR: Bond Payable
DR: Premium on Bonds Payable
DR: Loss
CR: Investment in Bonds
CR: Discount on Bonds Payable
CR: Gain