Advanced Financial Accounting Consolidation Entries

Consolidating Entry *C

Used for non-equity method to adjust investment balance to EM balance:
Debit Investment in Sub
Credit Beginning Retained Earnings

Consolidating Entry *G

Reverse prior-year intra-entity transfer:
Debit Beginning Retained Earnings of Seller
Credit Cost of Goods Sold (COGS)

Consolidating Entry *GL

Eliminate effect of intra-entity land transfer from a previous year:
Debit Beginning Retained Earnings of Seller
Credit Land

Consolidating Entry *GL (year of sale to outside party)

Debit Retained Earnings
Credit Gain on Sale

Consolidating Entry *TA (year following transfer)

Return Equipment to original historic cost and correct the beginning balances of RE and AD:
Debit Equipment and Beginning Retained Earnings
Credit Accumulated Depreciation

Consolidating Entry *B (year following transfer)

Remove intra-entity bonds and related interest accounts, as well as effect of discount/premium on retained earnings:
Debit Bonds Payable at Face Value, Interest Income, and Retained Earnings OR Premium on Bond Payable
Credit Investment in Bonds, Interest

Consolidating Entry S

Remove subsidiary equity:
Debit Stock of Sub and Remaining Beginning Retained Earnings of Sub
Credit Investment in Sub and Non-Controlling Interest (NCI) in proportion to ownership %.

Consolidating Entry A

Allocate excess of fair value:
Debit sub's undervalued assets and Goodwill by unamortized amount
Credit Investment in Sub and Non-Controlling Interest (NCI) in proportion to ownership %.

Consolidating Entry I

Remove equity in subsidiary income:
Debit Equity in Sub Income
Credit Investment in Sub

Consolidating Entry D

Remove dividends:
Debit Investment in Sub (based on ownership %)
Credit Dividends Declared (based on ownership %)

Consolidating Entry E

Record current year amortization:
Debit amortization expense
Credit undervalued sub assets

Consolidating Entry TI (year of transfer)

Remove intra-entity sale:
Debit Sales
Credit Cost of Goods Sold (COGS)

Consolidating Entry G (year of transfer)

Record remaining inventory from intra-entity transfer:
Debit Cost of Goods Sold (COGS)
Credit Inventory

Consolidating Entry TL (year of transfer)

Debit Gain on Sale of Land
Credit Land

Consolidating Entry TA (year of transfer)

Remove unrealized gain and return equipment accounts to balances based on original historical cost:
Debit Gain on Sale of Equipment and Equipment
Credit Accumulated Depreciation

Consolidating Entry ED (year of transfer)

Remove overstatement of depreciation caused by inflated transfer price:
Debit Accumulated Depreciation
Credit Depreciation Expense

Consolidating Entry B (year of transfer)

Eliminate Intra-Entity Bonds and Related Investment Accounts and Recognize Gain/Loss on effective retirement:
Debit Bonds Payable at Face Value, Interest Income, and Premium on Bond Payable OR Loss on Retirement of Bonds
Credit Investment in Bonds, Intere