Question

1. Questions 1 & 2 are based on the following information. Polypipe Company acquired 80% of Svedex Company's votings The noncontrolling interest had an estimated fair value of $20,000. Some of dex's identifiable assets and liabilities at the date of acquisition had fair values that were different from reported values, as follows: Property, net Licensing agreements Book Value $ 6,000 1,000 Fair Value $4,000 25,000 Svedex's total shareholders' equity at the date of acquisition was as follows: bles for Paul Capital stock Retained deficit Treasury stock blbost Total OSOS $5,000 (400) (50) $ 4,550 On a date-of-acquisition consolidation working paper, eliminating entry (E) credits Investment in Svedex in the amount of A) $4,360 B) $3,640 C) $4,000 D) $3,980 2. On a date-of-acquisition consolidation working paper, eliminating entry (R) credits the noncontrolling interest in Svedex in the amount of A) $20,000 B) $15,450 C) $19,090 D) $18,600

Answer 1

	Q1)	Eliminating investment in Svedex in consolidating working paper
			Capital Stock		$       5,000
			Retained Deficit		$         -400
			Treasury stock		$            -50
			Total		$       4,550
			Investment (80%)		$       3,640
			Therefore correct option is B)$3640
	Q2)	Fair Value Of non-controlling interest is $20000
		therefore credit of $20000 should be given to Non Controlling interest
		therefore, Correct option is A) $20000