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100% Ownership Land Transfer (Non-Depreciable) • On 3/31/X5,Parker Inc. sold land costing $40,000 to its 100% owned subsidiary,Stubben Inc., for $100,000.

• In this example, we’ll do consolidation worksheet entrieswithout adjusting the equity method accounts.

• This is the modified equity method.

• This is meant to be a conceptual exercise only. (We willswitch to the fully adjusted equity method next.)

Required:

1. Prepare the consolidation entry(ies) as of 12/31/X5 and12/31/X6.

2. Prepare the consolidation entry at 12/31/X7, assuming thatStubben sold the land in 20X7 for $120,000.

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Deanna Hettinger
Deanna HettingerLv2
28 Sep 2019

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