Tony90504
Newbie
Joined: 02 Sep 2011
Online Status: Offline
Posts: 13
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| Posted: 21 Sep 2011 at 03:29 | IP Logged
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Hello guys,
I'm trying to figure out proper JE for this question and
if someone can figure it out for me, I would really
appreciate it.
Wagner, a holder of a $1,000,000 Palmer Bonds, collected
the interest due on March 31, 2011, and then sold the
bonds to Seal, Inc. for $975,000. On that date, Palmer, a
75% owner of Seal, had a $1,075,000 carrying amount for
the bonds. What was the effect of Seal's purchase of
Palmer's bond on the retained earnings and non
controlling interest amounts reported in Palmer's March
31, 2011 consolidated balance sheet? (answer is $100,000)
my answer is probably this...
Investment 1075000
Cash &n bsp; 97 5000
Discount &nbs p; 100000
then
B/P 1,000,000
Premium 75,000
Discount 100,000 (from above)
Investment in bond &n bsp; 1,075,000
Gain in retirement &n bsp; 100,000
Thanks!
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