(Solved): Harper, Inc., acquires 40 percent of the outstanding voting stock of Kinman Company on January 1, ...

Harper, Inc., acquires 40 percent of the outstanding voting stock of Kinman Company on January 1,2020 , for \( \$ 345,900 \) in cash. The book value of Kinman's net assets on that date was \( \$ 675,000 \), although one of the company's bulldings, with a \( \$ 63,600 \) carrying amount, was actually worth \( \$ 125,850 \). This building had a 10-year remaining IIfe. KInman owned a royalty agreement with a 20 -year remaining life that was undervalued by \( \$ 127,500 \). KInman sold Inventory with an original cost of \( \$ 69,300 \) to Harper during 2020 at a price of \( \$ 99,000 \). Harper still held \( \$ 19,800 \) (transfer price) of this amount in inventory as of December 31,2020 . These goods are to be sold to outside partles during \( 2021 . \) Kinman reported a \( \$ 55,000 \) net loss and a \( \$ 21,000 \) other comprehensive loss for 2020 . The company still manages to declare and pay a \( \$ 7,000 \) cash dividend during the year. During 2021, Kinman reported a \( \$ 45,800 \) net Income and declared and paid a cash dividend of \( \$ 9,000 \). It made additional Inventory sales of \( \$ 84,000 \) to Harper during the perlod. The orlginal cost of the merchandise was \( \$ 52,500 \). All but 30 percent of this Inventory had been resold to outside partles by the end of the 2021 fiscal year. Prepare all journal entrles for Harper for 2020 and 2021 in connection with this Investment. Assume that the equity method Is applied. (If no entry Is required for a transaction/event, select "No journal entry required" In the first account fleld. Do not round Intermedlate calculatlons.) Journal entry worksheet Harper, Inc., acquires 40 percent of the outstanding voting stock of KInman Company on January 1,2020 , for \( \$ 345,900 \) in cash. The book value of Kinman's net assets on that date was \( \$ 675,000 \), although one of the company's bulldings, with a \( \$ 63,600 \) carrying amount, was actually worth \( \$ 125,850 \). This building had a 10-year remaining Iffe. Kinman owned a royalty agreement with a 20 -year remaining life that was undervalued by \( \$ 127,500 \). KInman sold Inventory with an original cost of \( \$ 69,300 \) to Harper during 2020 at a price of \( \$ 99,000 \). Harper still held \( \$ 19,800 \) (transfer price) of this amount in Inventory as of December 31,2020 . These goods are to be sold to outside partles during \( 2021 . \) KInman reported a \( \$ 55,000 \) net loss and a \( \$ 21,000 \) other comprehensive loss for 2020 . The company still manages to declare and pay a \( \$ 7,000 \) cash dividend during the year. During 2021, Kinman reported a \( \$ 45,800 \) net Income and declared and paid a cash dividend of \( \$ 9,000 \). It made additional Inventory sales of \( \$ 84,000 \) to Harper during the perlod. The original cost of the merchandise was \( \$ 52,500 \). All but 30 percent of this inventory had been resold to outside partles by the end of the 2021 fiscal year. Prepare all journal entries for Harper for 2020 and 2021 In connection with this Investment. Assume that the equity method is applied. (If no entry Is required for a transactlon/event, select "No Journal entry required" In the flrst account fleld. Do not round Intermedlate calculations.) Journal entry worksheet Harper, Inc., acquires 40 percent of the outstanding voting stock of KInman Company on January 1,2020 , for \( \$ 345,900 \) in cash. The book value of Kinman's net assets on that date was \( \$ 675,000 \), although one of the company's buildings, with a \( \$ 63,600 \) carrying amount, was actually worth \( \$ 125,850 \). This building had a 10 -year remalning life. Kinman owned a royalty agreement with a 20 -year remaining life that was undervalued by \( \$ 127,500 \). Kinman sold Inventory with an original cost of \( \$ 69,300 \) to Harper during 2020 at a price of \( \$ 99,000 \). Harper still held \( \$ 19,800 \) (transfer price) of this amount in inventory as of December 31,2020 . These goods are to be sold to outside partles during \( 2021 . \) Kinman reported a \( \$ 55,000 \) net loss and a \( \$ 21,000 \) other comprehensive loss for 2020 . The company still manages to declare and pay a \( \$ 7,000 \) cash dividend during the year. During 2021, Kinman reported a \( \$ 45,800 \) net Income and declared and paid a cash dividend of \( \$ 9,000 \). It made additional Inventory sales of \( \$ 84,000 \) to Harper during the perlod. The orlginal cost of the merchandise was \( \$ 52,500 \). All but 30 percent of this Inventory had been resold to outside partles by the end of the 2021 fiscal year. Prepare all journal entries for Harper for 2020 and 2021 In connection with this Investment. Assume that the equity method is applied. (If no entry Is required for a transactlon/event, select "No Journal entry required" In the first account fleld. Do not round Intermecllate calculations.) Journal entry worksheet Note: tnter aedits detore crealts. Harper, Inc., acquires 40 percent of the outstanding voting stock of Kinman Company on January 1,2020 , for \( \$ 345,900 \) in cash. The book value of Kinman's net assets on that date was \( \$ 675,000 \), although one of the company's bulldings, with a \( \$ 63,600 \) carrying amount, was actually worth \( \$ 125,850 \). This bullding had a 10-year remaining IIfe. Kinman owned a royalty agreement with a 20 -year remaining life that was undervalued by \( \$ 127,500 \). KInman sold Inventory with an original cost of \( \$ 69,300 \) to Harper during 2020 at a price of \( \$ 99,000 \). Harper still held \( \$ 19,800 \) (transfer price) of this amount in Inventory as of December 31,2020 . These goods are to be sold to outside partles during \( 2021 . \) KInman reported a \( \$ 55,000 \) net loss and a \( \$ 21,000 \) other comprehensive loss for 2020 . The company still manages to declare and pay a \( \$ 7,000 \) cash dividend during the year. During 2021, KInman reported a \( \$ 45,800 \) net Income and declared and paid a cash dividend of \( \$ 9,000 \). It made additional Inventory sales of \( \$ 84,000 \) to Harper during the perlod. The orlginal cost of the merchandise was \( \$ 52,500 \). All but 30 percent of this Inventory had been resold to outside partles by the end of the 2021 fiscal year. Prepare all journal entries for Harper for 2020 and 2021 In connection with this investment. Assume that the equity method is applied. (If no entry Is required for a transaction/event, select "No Journal entry requlred" In the flrst account fleid. Do not round Intermedlate calculations.) Journal entry worksheet Harper, Inc., acquires 40 percent of the outstanding voting stock of Kinman Company on January 1,2020 , for \( \$ 345,900 \) In cash. The book value of Kinman's net assets on that date was \( \$ 675,000 \), although one of the company's buildings, with a \( \$ 63,600 \) carrying amount, was actually worth \( \$ 125,850 \). This building had a 10-year remaining Iffe. Kinman owned a royalty agreement with a 20 -year remaining life that was undervalued by \( \$ 127,500 \). Kinman sold Inventory with an original cost of \( \$ 69,300 \) to Harper during 2020 at a price of \( \$ 99,000 \). Harper still held \( \$ 19,800 \) (transfer price) of this amount in inventory as of December 31, 2020 . These goods are to be sold to outside partles during \( 2021 . \) KInman reported a \( \$ 55,000 \) net loss and a \( \$ 21,000 \) other comprehensive loss for 2020 . The company still manages to declare and pay a \( \$ 7,000 \) cash dividend during the year. During 2021, Kinman reported a \( \$ 45,800 \) net Income and declared and paid a cash dividend of \( \$ 9,000 \). It made additional Inventory sales of \( \$ 84,000 \) to Harper during the perlod. The original cost of the merchandise was \( \$ 52,500 \). All but 30 percent of this Inventory had been resold to outside partles by the end of the 2021 fiscal year. Prepare all journal entrles for Harper for 2020 and 2021 In connection with this Investment. Assume that the equity method is applied. (If no entry Is required for a transactlon/event, select "No Journal entry required" In the first account fleld. Do not round Intermedlate calculations.) lournal entrv worksheet Note: Enter debits before credits. Harper, Inc., acquires 40 percent of the outstanding voting stock of Kinman Company on January 1,2020 , for \( \$ 345,900 \) In cash. The book value of Kinman's net assets on that date was \( \$ 675,000 \), although one of the company's buildings, with a \( \$ 63,600 \) carrying amount, was actually worth \( \$ 125,850 \). This building had a 10-year remalning life. KInman owned a royalty agreement with a 20 -year remaining life that was undervalued by \( \$ 127,500 \). KInman sold Inventory with an original cost of \( \$ 69,300 \) to Harper during 2020 at a price of \( \$ 99,000 \). Harper still held \( \$ 19,800 \) (transfer price) of this amount in Inventory as of December 31, 2020. These goods are to be sold to outside parties during \( 2021 . \) KInman reported a \( \$ 55,000 \) net loss and a \( \$ 21,000 \) other comprehensive loss for 2020 . The company still manages to declare and pay a \( \$ 7,000 \) cash dlvidend during the year. During 2021, Kinman reported a \( \$ 45,800 \) net Income and declared and paid a cash dividend of \( \$ 9,000 \). It made additional Inventory sales of \( \$ 84,000 \) to Harper during the perlod. The original cost of the merchandise was \( \$ 52,500 \). All but 30 percent of this Inventory had been resold to outside partles by the end of the 2021 fiscal year. Prepare all journal entrles for Harper for 2020 and 2021 in connection with this Investment. Assume that the equity method is applied. If no entry is required for a transactlon/event, select "No Journal entry required" In the flrst account fleld. Do not round Intermedlate calculations.) Journal entry worksheet \( \begin{array}{llllll} & 1 & 2 & 3 & 4 & 5\end{array} \) Record the deferred unrealized gross profit on intra-entity sale. Note: Enter debits before credits. Harper, Inc., acquires 40 percent of the outstanding voting stock of KInman Company on January 1,2020 , for \( \$ 345,900 \) in cash. The book value of Kinman's net assets on that date was \( \$ 675,000 \), although one of the company's buildings, with a \( \$ 63,600 \) carrying amount, was actually worth \( \$ 125,850 \). This bullding had a 10-year remaining Iffe. Kinman owned a royalty agreement with a 20 -year remaining life that was undervalued by \( \$ 127,500 \). Kinman sold Inventory with an original cost of \( \$ 69,300 \) to Harper during 2020 at a price of \( \$ 99,000 \). Harper still held \( \$ 19,800 \) (transfer price) of this amount in Inventory as of December 31,2020 . These goods are to be sold to outside partles during \( 2021 . \) Kinman reported a \( \$ 55,000 \) net loss and a \( \$ 21,000 \) other comprehensive loss for 2020 . The company still manages to declare and pay a \( \$ 7,000 \) cash dividend during the year. During 2021, Kinman reported a \( \$ 45,800 \) net Income and declared and paid a cash dividend of \( \$ 9,000 \). It made additional Inventory sales of \( \$ 84,000 \) to Harper durlng the perlod. The orlginal cost of the merchandise was \( \$ 52,500 \). All but 30 percent of this Inventory had been resold to outside partles by the end of the 2021 fiscal year. Prepare all journal entrles for Harper for 2020 and 2021 in connection with this Investment. Assume that the equity method Is applied. (If no entry Is required for a transaction/event, select "No Journal entry requlred" In the flrst account fleld. Do not round Intermedlate calculations.) Journal entry worksheet Harper, Inc., acquires 40 percent of the outstanding voting stock of Kinman Company on January 1,2020 , for \( \$ 345,900 \) in cash. The book value of Kinman's net assets on that date was \( \$ 675,000 \), although one of the company's buildings, with a \( \$ 63,600 \) carrying amount, was actually worth \( \$ 125,850 \). This building had a 10-year remaining life. KInman owned a royalty agreement with a 20 -year remaining life that was undervalued by \( \$ 127,500 \). KInman sold Inventory with an original cost of \( \$ 69,300 \) to Harper during 2020 at a price of \( \$ 99,000 \). Harper still held \( \$ 19,800 \) (transfer price) of this amount in Inventory as of December 31, 2020. These goods are to be sold to outside partles during \( 2021 . \) KInman reported a \( \$ 55,000 \) net loss and a \( \$ 21,000 \) other comprehensive loss for 2020 . The company still manages to declare and pay a \( \$ 7,000 \) cash dividend during the year. During 2021, KInman reported a \( \$ 45,800 \) net Income and declared and pald a cash dividend of \( \$ 9,000 \). It made additional Inventory sales of \( \$ 84,000 \) to Harper during the perlod. The orlginal cost of the merchandise was \( \$ 52,500 \). All but 30 percent of this inventory had been resold to outside partles by the end of the 2021 fiscal year. Prepare all journal entrles for Harper for 2020 and 2021 in connection with this Investment. Assume that the equity method is applied. (If no entry Is required for a transaction/event, select "No Journal entry required" In the flrst account fleld. Do not round Intermedlate calculatlons.) Journal entry worksheet Harper, Inc., acquires 40 percent of the outstanding voting stock of KInman Company on January 1,2020 , for \( \$ 345,900 \) in cash. The book value of Kinman's net assets on that date was \( \$ 675,000 \), although one of the company's bulldings, with a \( \$ 63,600 \) carrying amount, was actually worth \( \$ 125,850 \). This building had a 10-year remalning Iffe. KInman owned a royalty agreement with a 20 -year remaining life that was undervalued by \( \$ 127,500 \). KInman sold Inventory with an original cost of \( \$ 69,300 \) to Harper during 2020 at a price of \( \$ 99,000 \). Harper still held \( \$ 19,800 \) (transfer price) of this amount in Inventory as of December 31,2020 . These goods are to be sold to outside partles during \( 2021 . \) KInman reported a \( \$ 55,000 \) net loss and a \( \$ 21,000 \) other comprehensive loss for 2020 . The company still manages to declare and pay a \( \$ 7,000 \) cash dividend durlng the year. During 2021, Kinman reported a \( \$ 45,800 \) net Income and declared and paid a cash dividend of \( \$ 9,000 \). It made additional Inventory sales of \( \$ 84,000 \) to Harper during the perlod. The orlginal cost of the merchandise was \( \$ 52,500 \). All but 30 percent of this Inventory had been resold to outside partles by the end of the 2021 fiscal year. Prepare all journal entries for Harper for 2020 and 2021 In connection with this Investment. Assume that the equity method is applied. (If no entry Is required for a transaction/event, select "No Journal entry requlred" In the flrst account fleld. Do not round Intermeclate calculations.) Journal entry worksheet Record the \( 40 \% \) accrual of income as earned by equity investee. Note: Enter debits before credits. Harper, Inc., acquires 40 percent of the outstanding voting stock of KInman Company on January 1,2020 , for \( \$ 345,900 \) in cash. The book value of Kinman's net assets on that date was \( \$ 675,000 \), although one of the company's bulldings, with a \( \$ 63,600 \) carrying amount, was actually worth \( \$ 125,850 \). This bullding had a 10-year remaining Iffe. Kinman owned a royalty agreement with a 20 -year remaining life that was undervalued by \( \$ 127,500 \). Kinman sold Inventory with an original cost of \( \$ 69,300 \) to Harper during 2020 at a price of \( \$ 99,000 \). Harper still held \( \$ 19,800 \) (transfer price) of this amount in inventory as of December 31,2020 . These goods are to be sold to outside partles during \( 2021 . \) Kinman reported a \( \$ 55,000 \) net loss and a \( \$ 21,000 \) other comprehensive loss for 2020 . The company still manages to declare and pay a \( \$ 7,000 \) cash dividend during the year. During 2021 , Kinman reported a \( \$ 45,800 \) net Income and declared and paid a cash dividend of \( \$ 9,000 \). It made additional Inventory sales of \( \$ 84,000 \) to Harper durIng the perlod. The orlginal cost of the merchandise was \( \$ 52,500 \). All but 30 percent of this Inventory had been resold to outside partles by the end of the 2021 fiscal year. Prepare all journal entrles for Harper for 2020 and 2021 in connection with this investment. Assume that the equity method is applied. (If no entry Is required for a transaction/event, select "No journal entry required" In the flrst account fleld. Do not round Intermedlate calculatlons.) Journal entry worksheet Harper, Inc., acquires 40 percent of the outstanding voting stock of Kinman Company on January 1,2020 , for \( \$ 345,900 \) in cash. The book value of Kinman's net assets on that date was \( \$ 675,000 \), although one of the company's bulldings, with a \( \$ 63,600 \) carrying amount, was actually worth \( \$ 125,850 \). This building had a 10-year remaining life. Kinman owned a royalty agreement with a 20 -year remaining life that was undervalued by \( \$ 127,500 \). Kinman sold Inventory with an original cost of \( \$ 69,300 \) to Harper during 2020 at a price of \( \$ 99,000 \). Harper still held \( \$ 19,800 \) (transfer price) of this amount in Inventory as of December 31,2020 . These goods are to be sold to outside partles during \( 2021 . \) KInman reported a \( \$ 55,000 \) net loss and a \( \$ 21,000 \) other comprehensive loss for 2020 . The company still manages to declare and pay a \( \$ 7,000 \) cash dlvidend durlng the year. During 2021, Kinman reported a \( \$ 45,800 \) net Income and declared and paid a cash dividend of \( \$ 9,000 \). It made additional Inventory sales of \( \$ 84,000 \) to Harper during the perlod. The original cost of the merchandise was \( \$ 52,500 \). All but 30 percent of this inventory had been resold to outside partles by the end of the 2021 fiscal year. Prepare all journal entrles for Harper for 2020 and 2021 in connection with this Investment. Assume that the equity method is applied. (If no entry Is required for a transaction/event, select "No Journal entry requlred" In the flrst account fleld. Do not round Intermedlate calculations.) Journal entry worksheet Harper, Inc., acquires 40 percent of the outstanding voting stock of KInman Company on January 1,2020 , for \( \$ 345,900 \) in cash. The book value of Kinman's net assets on that date was \( \$ 675,000 \), although one of the company's buildings, with a \( \$ 63,600 \) carrying amount, was actually worth \( \$ 125,850 \). This building had a 10-year remalning Iffe. KInman owned a royalty agreement with a 20 -year remaining life that was undervalued by \( \$ 127,500 \). Kinman sold Inventory with an original cost of \( \$ 69,300 \) to Harper during 2020 at a price of \( \$ 99,000 \). Harper still held \( \$ 19,800 \) (transfer price) of this amount in Inventory as of December 31,2020 . These goods are to be sold to outside partles during \( 2021 . \) KInman reported a \( \$ 55,000 \) net loss and a \( \$ 21,000 \) other comprehensive loss for 2020 . The company still manages to declare and pay a \( \$ 7,000 \) cash dividend durlng the year. During 2021, Kinman reported a \( \$ 45,800 \) net Income and declared and paid a cash dividend of \( \$ 9,000 \). It made additional Inventory sales of \( \$ 84,000 \) to Harper during the perlod. The orlginal cost of the merchandise was \( \$ 52,500 \). All but 30 percent of this Inventory had been resold to outside partles by the end of the 2021 fiscal year. Prepare all journal entrles for Harper for 2020 and 2021 In connection with this Investment. Assume that the equity method is applied. (If no entry Is required for a transaction/event, select "No Journal entry requlred" In the flrst account fleld. Do not round Intermedlate calculatlons.) Journal entry worksheet