| Course | AC450 Advanced Accounting |
|---|---|
| Unit | Unit 3 |
| Paper type | Acquisition date worksheet |
| Length | About 540 words, 4 pages double-spaced |
| Format | APA 7 student paper |
| School | Purdue University Global |
| Program | BS in Accounting |
| Updated | October 2026 |
Free sample paper for AC450 Unit 3
The Investment That Disappears: A Unit 3 Acquisition Date Consolidation Worksheet for a Glassworks
[Student Name]
Purdue University Global
AC450: Advanced Accounting
Unit 3 Acquisition Date Worksheet
[Instructor Name]
[Date]
The companies and every figure are composite; the standards and textbooks cited are real.
The Worksheet's Columns
Calder, Brookfield, debit eliminations, credit eliminations, noncontrolling interest and consolidated. Only a balance sheet appears, because the group has not yet existed long enough to earn anything.
Starting Balances
Calder's column shows total assets of $22,000,000, including the $6,400,000 investment, and liabilities of $7,000,000, including the $200,000 earn-out. Its equity is $15,000,000: common stock of $3,000,000, additional paid-in capital of $2,000,000 and retained earnings of $10,000,000.
Brookfield's column shows assets of $5,500,000 at book value: cash $400,000, receivables $700,000, inventory $900,000, land $600,000, building $1,700,000 net and equipment $1,200,000 net. Its liabilities are $1,300,000 and its equity $4,200,000: $1,000,000 of stock issued to the founders and $3,200,000 earned and kept over forty years.
Entry S: Eliminate Brookfield's Equity
Debit common stock $1,000,000 and retained earnings $3,200,000. Credit the investment $3,360,000, Calder's 80 percent of book value, and the noncontrolling interest $840,000, the family's 20 percent.
Entry A: Allocate the Excess
Debit inventory $120,000, land $250,000, building $900,000, customer relationships $1,000,000, trade name $400,000 and goodwill $1,230,000, for $3,900,000 of debits. Credit equipment $200,000, the investment $3,040,000 and the noncontrolling interest $660,000.
After entry A the investment account is zero, because the $6,400,000 Calder paid has been replaced line by line with the assets, liabilities and goodwill it bought, and the family's interest has risen from $840,000 of book value to its $1,500,000 fair value.
S and A follow the textbook convention: S eliminates the subsidiary's stockholders' equity and A allocates the acquisition-date excess of fair value over book value (Hoyle et al., 2021).
Why Equipment Is Credited
Brookfield's equipment is the one asset worth less than its carrying amount, so entry A credits it $200,000 and the group carries it at $1,000,000. That write-down will reduce depreciation in later years, an effect the later-period worksheet must carry forward. Inventory's $120,000 increase, by contrast, will flow into cost of goods sold within the year as the goods are sold, so it disappears from the allocation quickly.
Consolidated Totals
Consolidated assets: Calder's $22,000,000 less the $6,400,000 investment, plus Brookfield's $5,500,000, plus $3,700,000 of net adjustments and goodwill, for $24,800,000. Liabilities: $7,000,000 plus $1,300,000, for $8,300,000. Equity: Calder's $15,000,000 plus the noncontrolling interest of $1,500,000, for $16,500,000. Assets equal liabilities plus equity.
Brookfield's own equity accounts do not appear in the consolidated column; only Calder's equity and the noncontrolling interest remain. The noncontrolling interest is presented within equity, separately from the parent's, as the consolidation standard requires (Financial Accounting Standards Board, n.d.).
Checks
Every row totals across from the two companies' columns through the eliminations to the consolidated column. The elimination columns agree at $8,100,000: $4,200,000 from entry S and $3,900,000 from entry A. The noncontrolling interest column sums to $1,500,000, matching its fair value in the allocation. Goodwill of $1,230,000 agrees with the Unit 2 schedule. The acquisition-date worksheet sets the base from which every later consolidation rolls forward, so errors here repeat every year (Christensen et al., 2019).
References
Christensen, T. E., Cottrell, D. M., & Budd, C. S. (2019). Advanced financial accounting (12th ed.). McGraw Hill.
Financial Accounting Standards Board. (n.d.). Accounting Standards Codification Topic 810: Consolidation. FASB.
Hoyle, J. B., Schaefer, T. F., & Doupnik, T. S. (2021). Advanced accounting (14th ed.). McGraw Hill.
AC450 Unit 3 instructions, in plain terms
In the third AC450 unit, the group is consolidated on the morning the purchase closes. Set up columns for the parent, the subsidiary, debit and credit eliminations, the noncontrolling interest and the consolidated total. Show only a balance sheet, since the group has not yet earned income. Enter both companies' balances, then eliminate the subsidiary's equity against the investment and the noncontrolling interest at book value. Next, allocate the excess of fair value over book value to identified assets, intangibles and goodwill, removing the rest of the investment and raising the noncontrolling interest to fair value. Explain each entry and any adjustment that reduces an asset. Compute consolidated totals and show that assets equal liabilities plus equity, with the noncontrolling interest in equity. Check that every row totals across and the elimination columns agree. Cite the consolidation standard and advanced accounting texts in APA 7.
How the AC 450 Unit 3 example is put together
The sample describes the six columns and why no income statement appears. Starting balances give Calder $22,000,000 of assets, including the investment, and Brookfield $5,500,000 at book value, with each company's equity. Entry S debits Brookfield's stock and retained earnings and credits $3,360,000 of investment and $840,000 of noncontrolling interest. Entry A debits $3,900,000 of adjustments and goodwill and credits equipment, investment and noncontrolling interest. The highlighted sentence explains that the investment is now zero and the family's interest at fair value, and the S and A convention is cited from Hoyle and colleagues. A section explains the equipment credit and the inventory adjustment's short life. Consolidated totals of $24,800,000, $8,300,000 and $16,500,000 follow, with checks on rows, columns and goodwill.
AC450 Unit 3 rubric: what earns full points
AC450 acquisition date worksheets are graded on correct eliminations, correct consolidated totals and complete checks. Entry S must remove all of the subsidiary's equity and split it between the investment and the noncontrolling interest at book value. Entry A must allocate every adjustment, including decreases, and recognize goodwill, while bringing the noncontrolling interest to fair value. Graders check that the investment account is fully eliminated and that the subsidiary's equity accounts do not survive into the consolidated column. The noncontrolling interest must appear within equity. Consolidated totals should balance, every row should total across and the elimination columns should agree. Explaining each entry, rather than only entering it, earns the analysis credit. A legible layout and APA 7 citations to the standard complete what this Purdue Global worksheet is graded on.
AC450 Unit 3 help from the desk
Many Unit 3 worksheets include an income statement or consolidated retained earnings that add the subsidiary's balance. Others eliminate only the parent's share of equity, leaving the minority's share in the subsidiary's accounts. Fair value decreases are ignored. Goodwill is computed for the parent only, so the noncontrolling interest stays at book value. The investment account is left partly in place. Rows are not checked across. If your problem uses a bargain purchase or a less than 80 percent stake, our writers can build the worksheet and key from your balances.
Get an AC450 Unit 3 example written to your instructions
For Unit 3, the two balance sheets as of the acquisition date, the price paid, the ownership percentage and any appraisal figures the problem supplies are the inputs; the rubric decides how long the key runs. A first custom worksheet is free, balanced to the dollar, and back within 24-48h. The paper above is an original model document written by our desk, not a submitted student paper and not an official Purdue University Global document.
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AC450 Unit 3 questions, answered
Why is there no income statement on the acquisition date worksheet?
Because the group has not existed long enough to earn anything. On the acquisition date, consolidation combines balance sheets only, and the glassworks' income before that morning belongs to the period before the parent owned it. Income statement columns arrive in later units, once the group has operated together, and the key mentions this so the omission reads as deliberate.
What do the letters S and A stand for?
They follow a common textbook convention: S eliminates the subsidiary's stockholders' equity against the investment, and A allocates the excess of fair value over book value to specific accounts and goodwill. Other texts number the entries or use different letters. The sample can follow whatever labels the course text uses, and the amounts do not change.
Can the worksheet be built on my own problem's balances?
Yes. Send both balance sheets, the purchase terms, the percentage acquired and any appraisal data, with the rubric. The worksheet comes back with entries sized to your figures, a key that explains each elimination in a sentence, and a check row proving the columns agree, so every removed amount can be traced to the fact that required it.
Where can I find a free AC450 Unit 3 sample paper?
This page holds a complete AC450 Unit 3 acquisition date worksheet for a composite glassworks group, with starting balances, entries S and A, consolidated totals, checks and APA 7 references.
Why is equipment credited in AC450 Unit 3 entry A?
Brookfield carried its equipment at $1,200,000, but it was worth $1,000,000 on the acquisition date. Entry A credits $200,000 so the group carries it at fair value.