Consolidation Journal Entries and Worksheet for Acquisition Analysis
VerifiedAdded on 2023/06/05
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Practical Assignment
AI Summary
This assignment focuses on the financial analysis of an acquisition, specifically addressing the consolidation of Ghostbusters Ltd. The solution provides detailed consolidation journal entries and a worksheet for the year ended June 30, 2020. The analysis begins with the fair value of assets and liabilities at the acquisition date (July 1, 2018) and calculates the goodwill. The assignment includes a comprehensive set of journal entries covering various aspects of the consolidation process, such as BCVR entries, depreciation, deferred tax implications, and pre-acquisition entries. It also addresses the elimination of intercompany profits from inventory and sales, intercompany loans, and dividend transactions. The final part of the solution presents the consolidated financial statements, including the income statement and balance sheet, which are prepared by adjusting and combining the financial data of the acquiring and acquired companies. This structured approach offers students a practical understanding of financial accounting and consolidation procedures.
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