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    Entries for Consolidation of Intercorporate Investments

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    Please help. I'm trying to follow the examples in the text book, however I'm not sure I'm on the right track. Please help with step-by-step on how the journal entries should be made.

    See the attached file.

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    Required A
    Pooling: Entry basis is book value of Wheal Company
    DR: Investment in Wheal Company* $160,000
    CR: Capital stock** 110,000
    CR: Other contributed capital*** 15,000
    CR: Retained earnings**** 35,000
    *Book value of net assets: 250,000-30,000-20,000-40,000=160,000
    **issued by Axel
    ***Total paid in: 100,000+25000 = 125,000
    ****Retained earnings: balancing figure

    Purchase: ...

    Solution Summary

    The solution examines entries for consolidation of intercorporate investments.