Author: Christine Farr


The final project for this course is the creation of an Excel spreadsheet model that shows the consolidation worksheet, intercompany elimination entries, other consolidation entries, and the final income statement and balance sheet for a sample parent and subsidiary company. The project is divided into three milestones, which will be submitted at various points throughout the course to scaffold learning and ensure quality final submissions. These milestones will be submitted in Modules Four, Seven, and Nine.
Assume the following when completing the project:
Assume that the parent owned the subsidiary for the entire year for which financial statements are being prepared. The scenario indicates that as of December 31, there is a difference between book value and fair value for inventory and depreciable assets. Assume that these differences existed at the date of acquisition. Record only the differential and do not worry about amortization of the differential. Prepare the consolidation worksheet using the equity method. Assume that the trial balance was prepared prior to any entry the parent company made to record the net loss from the subsidiary.
The Model Assignment:
Students will be given the description of a parent company and a subsidiary company along with the two firms’ trial balances at book value as of December 31, 2012, the end of the year for both firms (see Company Information below).
The financial data will be presented in English pounds (£) as local currency.
Other data pertaining to the consolidation is also to be provided.
The student will analyze the data for purpose of consolidation.
The student will create a useful Excel model that shows the consolidation worksheet, intercompany elimination entries, other consolidation entries, and the final income statement and balance sheet.
Using the consolidated financial statements created, students will then use Excel modeling to translate the consolidated income statement and balance sheet from English pounds to U.S. dollars based on exchange rates provided (the U.S. dollar is the functional currency).
This project should be prepared as a report for your supervisor.
The report should be visually pleasing.
As many computations as possible should be done by the model with the exception of entering the original financial statement data.
The report should utilize “macros” and other built-in features found in Excel.

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