on october 1 2015 para company purchased 90 of the outstanding common stock of star 4372434

On October 1, 2015, Para Company purchased 90% of the outstanding common stock of Star Company for $210,000. Additional data concerning Star Company for 2015 follows: Common stock ………………………….. $70,000 Other contributed capital …………………. 30,000 Retained earnings, ……………………. 1/1 70,000 Net income ……………………………….. 60,000 Dividends declared and paid (12/15) …….. 10,000 Any difference between book value and the value implied by the purchase price relates to goodwill. Para Company uses the partial equity method to record its investment in Star Company. Required: A. Prepare on Para Company’s books journal entries to record the investment-related activities for 2015? B. Prepare work paper eliminating entries for a work paper on December 31, 2015. Star Company’s net income is earned evenly throughout the year? View Solution:
On October 1 2015 Para Company purchased 90 of the

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