Borrow: Equity (paid-in capital) capital reserve Other comprehensive income Surplus reserve undistributed profit Loan: Long-term equity investment (parent company) Minority interests (fixed ratio)

1. Adjust the parent company’s individual cost method accounting results to the joint equity method accounting results (three supplements and one adjustment) (adjusting entries)

2. Offset the owner’s equity of the parent company Long-Term Investment and its subsidiaries (offset equity)

3 Offset the investment income of the parent company and profit distribution of subsidiaries (offset profits and losses)

1. Adjust the estimated value added (actually adjusted from book to fair) (fair > book at the time of purchase)/depreciation (fair < ​​book) Debit: fixed assets/inventories/intangible assets, etc. Credit: Capital reserve (or reverse, accounts receivable are generally assessed for impairment, credited) If income tax is considered, you also need to: Debit: capital reserve or, debit: deferred income tax assets Credit: Deferred income tax liabilities Credit: Capital reserves Or, merged together: Debit: fixed assets/inventories/intangible assets, etc. Credit: Capital reserve (crowding) Deferred income tax liability Calculate consolidated goodwill (will be used to offset equity later) The fair value of the subsidiary's identifiable net assets on the acquisition date after taking into account deferred income taxes: ① Book value of the subsidiary’s identifiable net assets on the date of purchase Appraisal increase × 75% ②The fair value of the identifiable net assets without deferred income tax on the date of purchase of the subsidiary - Appraisal increase × 25% Goodwill = merger cost - fair value share of identifiable net assets of the subsidiary (after taking into account deferred income taxes)

2. Offset rights and interests Borrow: Equity (paid-in capital) Capital reserves (including the increased value of assets and liabilities of subsidiaries) Other comprehensive income Surplus reserve undistributed profit Goodwill (debit balance) Loan: Long-term equity investment (parent company) Minority interests (fixed ratio)

5. Offset of internal transactions between parent and subsidiary companies [explained separately later]

1. Adjust the estimated value added (actually adjusted from book to fair) (fair > book at the time of purchase)/depreciation (fair < ​​book) Debit: fixed assets/inventories/intangible assets, etc. Credit: Capital reserve (or reverse, accounts receivable are generally assessed for impairment, credited) If income tax is considered, you also need to: Debit: capital reserve or, debit: deferred income tax assets Credit: Deferred income tax liabilities Credit: Capital reserves Or, merged together: Debit: fixed assets/inventories/intangible assets, etc. Credit: Capital reserve (crowding) Deferred income tax liability Calculate consolidated goodwill (will be used to offset equity later) The fair value of the subsidiary's identifiable net assets on the acquisition date after taking into account deferred income taxes: ① Book value of the subsidiary’s identifiable net assets on the date of purchase Appraisal increase × 75% ②The fair value of the identifiable net assets without deferred income tax on the date of purchase of the subsidiary - Appraisal increase × 25% Goodwill = merger cost - fair value share of identifiable net assets of the subsidiary (after taking into account deferred income taxes) Adjustment to the closing book value at the end of the year (assessment of subsequent changes in appreciation/depreciation) Debit: Management expenses [assume that depreciation of fixed assets is included in management expenses] Credit: Fixed assets (accumulated depreciation) Intangible assets (accumulated amortization) Borrow: operating costs (inventory valuation value-added external sales) Credit: Inventory goods Debit: Accounts receivable (the assessed amount has been collected and bad debts have been written off) Credit: Credit impairment loss Debit: Deferred income tax liabilities (depreciation or amortization is transferred back to the originally recognized deferred income tax liabilities) Credit: Income tax expense

2. Adjust the parent company’s individual cost method accounting results to the joint equity method accounting results (three supplements and one adjustment) (adjusting entries)

3. Offset the owner’s equity of the parent company Chang Investment and its subsidiary (offset equity)

4. Offset the investment income of the parent company and profit distribution of subsidiaries (offset profits and losses)

Year 1: Borrow: operating income [internal sales price excluding tax] ① Credit: Operating costs [back squeeze] ③ Inventories and fixed assets [Gross profit × unsold %] ②

Year 2: ① Offset the previous year Borrow: Undistributed profits at the beginning of the year Credit: Undistributed profits at the beginning of the year Inventory (if it has been sold, change it to operating cost here. If part of it is sold, credit: inventory and operating cost respectively in proportion) 【hint】 If the unsold inventory of the previous year is sold this year, "inventory" will be converted to "operating cost" ②Offset this year If internal inventory transactions occur again this year, the handling principles are the same as those of the previous year.

Year 1: (Initial establishment) Individual report: cost 2000> net realizable value 1800 (1320), provision for inventory decline in price 200 (680) Combined report: cost 1400> net realizable value 1320, provision for inventory devaluation 80 The former: there is no impairment in the consolidated statement, and all 200 is written back; the latter: only 80 is recognized in the consolidated statement, and part of it is 600; Borrow: Inventory 200 (600) (report type item, replacing inventory depreciation reserve) Credit: Asset impairment provision 200 (600) Year 2: (continuous preparation) ① Offset the previous year Borrow: Inventory (Provision for inventory decline) Credit: Undistributed profits at the beginning of the year If there is external sales in this period, then: (The previous provision for price decline in the individual table has been eliminated in the consolidated table and does not exist. After the individual table sells goods, the inventory provision for decline in price carried forward by the individual table will also be eliminated in the consolidated table. ) Debit: operating costs [carried forward according to sales ratio] Credit: Inventory (Provision for inventory decline) ②Offset this year The idea is the same as last year.

Offsetting entries: Borrow: Debt (payable to xx) Loan: Debt type (xx receivable, debt investment)

Debit: Accounts receivable (replacing bad debt provision) Notes receivable (replacing bad debt provision) Credit: Credit impairment loss

Year 1: (Initial establishment) If: At the end of the previous year (receivable 500, bad debt 20) Debit: Accounts payable 500 Credit: Accounts receivable 500 Debit: Accounts receivable (bad debt provision) 20 Credit: Credit impairment loss 20 Year 2: (continuous preparation) Scenario 1: The current balance of internal accounts receivable is equal to the previous period This year (receivable 500, bad debt 20) Debit: Accounts payable 500 Credit: Accounts receivable 500 Debit: Accounts receivable (bad debt provision) 20 Credit: Undistributed profit at the beginning of the year 20 Scenario 2: The current balance of internal accounts receivable is greater than the balance of the previous period Amount of bad debt provision = 40 at the end of the period - 20 at the beginning of the period (offset) = 20 (offset) End of the year (receivables 600, bad debts 40) Debit: Accounts payable 600 Credit: Accounts receivable 600 Debit: Accounts receivable (bad debt provision) 20 [previous period] Credit: Undistributed profit at the beginning of the year 20 Debit: Accounts receivable (bad debt provision) 20 [current period] Credit: Credit impairment loss 20 Scenario 3: The current balance of internal accounts receivable is less than the balance of the previous period Bad debt provision amount = 10 at the end of the period - 20 at the beginning of the period (offset) = -10 (reversal) End of the year (receivable 400, repayment 10) Debit: Accounts payable 400 Credit: Accounts receivable 400 Debit: Accounts receivable (bad debt provision) 20 [previous period] Credit: Undistributed profit at the beginning of the year 20 Borrow: Credit impairment loss 10 [current period] Credit: Accounts receivable (bad debt provision) 10

Borrow: operating income Credit: Operating costs Fixed assets (inflated original value)

Borrow: fixed assets (replacing accumulated depreciation) (inflated original value/n*m/12) Credit: administrative expenses, depending on the situation, sales department is sales expenses, etc. (If the sale is at a loss and less depreciation is provided, the reverse will apply)

Year 1: (Initial establishment) (1) Offset the original value of fixed assets (sell inventory to make fixed assets) Borrow: operating income Credit: Operating costs Fixed assets [inflated original value] Or (sell fixed assets to make fixed assets) Borrow: Proceeds from asset disposal Credit: fixed assets [inflated original value] (2) Offset fixed over-accrued asset depreciation Debit: Fixed assets (accumulated depreciation) Credit: Management expenses [inflated original value/n×m/12] (if the sale is at a loss and less depreciation is provided, the reverse will be reversed) Year 2: (continuous preparation) (1) Offset the original value and depreciation of fixed assets (year 1) ①Debit: Undistributed profits at the beginning of the year Credit: fixed assets [inflated original value] ②Debit: Fixed assets (accumulated depreciation) Credit: Undistributed profits at the beginning of the year (2) Offset the current period (depreciation) (year 2) Debit, fixed assets (accumulated depreciation) loan, administrative expenses … Year n 1: (assuming that the accumulated depreciation in the nth year has been withdrawn) the positive and negative amounts are the same ①Debit: Undistributed profits at the beginning of the year Credit: fixed assets ②Debit: Fixed assets (accumulated depreciation) Credit: Undistributed profits at the beginning of the year

Replace all "fixed assets" items with "asset disposal income", regardless of whether they are scrapped in advance, just in time, or delayed. Write it as normal first, and then replace it (the question may require recording "non-operating income and non-operating expenses") (1) Offset the original value and depreciation of fixed assets (year 1) ①Debit: Undistributed profits at the beginning of the year Credit: fixed assets [inflated original value] ②Debit: Fixed assets (accumulated depreciation) Credit: Undistributed profits at the beginning of the year (2) Offset the current period (depreciation) (year 2) Debit, fixed assets (accumulated depreciation) loan, administrative expenses

(1) Offset the original value of the inflated increase Borrow: Proceeds from asset disposal Credit: Intangible assets [inflated original value] (if sold at a loss, it will be reversed) (2) Offset amortization of intangible assets Debit: Intangible assets (accumulated amortization) Credit: Management expenses (if the sale is at a loss, the reverse will apply)

Year 1: (Initial establishment) (1) Offset the original value of intangible assets Borrow: Proceeds from asset disposal Credit: Intangible assets [inflated original value] (2) Offset amortization of intangible assets Debit: Intangible assets (accumulated amortization) Credit: Management expenses [Inflated original value/n×m/12] Year 2: (continuous preparation) (1) Offset the original value and amortization of intangible assets (year 1) ①Debit: Undistributed profits at the beginning of the year Credit: Intangible assets [inflated original value] ②Debit: Intangible assets (accumulated amortization) Credit: Undistributed profits at the beginning of the year (2) Offset the current period (amortization) (year 2) Debit, intangible assets (accumulated amortization) loan, administrative expenses … Year n 1: (assuming that the accumulated amortization in year n has been withdrawn) the positive and negative amounts are the same ①Debit: Undistributed profits at the beginning of the year Credit: Intangible assets ②Debit: Intangible assets (accumulated amortization) Credit: Undistributed profits at the beginning of the year

Replace all "intangible assets" items with "asset disposal income", regardless of whether they are scrapped in advance, just in time, or delayed, write it normally first, and then replace it (the question may require recording "non-operating income, non-operating expenses") (1) Offset the original value and amortization of intangible assets (year 1) ①Debit: Undistributed profits at the beginning of the year Credit: Intangible assets [inflated original value] ②Debit: Intangible assets (accumulated amortization) Credit: Undistributed profits at the beginning of the year (2) Offset the current period (amortization) (year 2) Debit, intangible assets (accumulated amortization) loan, administrative expenses