between the fair value of the investment in Set and the book value of the interest to identifiable and unidentifiable net assets. 2. Prepare a consolidated balance sheet for Par Corporation and Subsidiary a
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REQUIRED
1. Prepare a schedule to assign the difference between the fair value of the investment in Set and the book value of the interest to identifiable and unidentifiable net assets.
2. Prepare a consolidated
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- P 3-2 Allocation schedule for fair value/book value differential and consolidated balance sheet at acquisition Pop Corporation acquired 70 percent of the outstanding common stock of Son Corporation on January 1, 2016, for $350,000 cash. Immediately after this acquisition the balance sheet information for the two companies was as follows (in thousands): Son Pop Book Value Book Value Fair Value Assets Cash $ 70 $ 40 $40 Receivables—net 160 60 60 Inventories 140 60 100 Land 200 100 120 Buildings—net 220 140 180 Equipment—net 160 80 60 Investment in Son 350 Total assets $1,300 $480 $ 560 Liabilities and Stockholders’ Equity Accounts payable $ 180 $160 $160 Other liabilities 20 100 80…PROBLEM VIII On July 1, 2018, Good Cop Company acquired 100% of Bad Cop Company for a consideration transferred of P80 million and pays P500,000 business combination expenses. 2/5 is attributable to share issue costs, 2/5 direct costs and 1/5 for indirect costs. At the acquisition date, the carrying amount of Bad Company's net assets was P50 million with provisional fair value of P60 million. An additional valuation received on May 1, 2019 increased this provisional valuation to P65 million, and on July 30, 2019 this fair value was finalized at P70 million. 1. What amount should Good Cop Company present for goodwill in its statement of financial position on December 31, 2019?Here are the pre-acquisition balance sheets of POP Company and Sicle Company onDecember 31, 20x5:Pop Co. Sicle Co.Book Value Book Value Market ValuesCurrent assets P 5,000,000 P 2,000,000 P 1,500,000Investments 1,000,000 500,000 500,000Land 10,000,000 5,000,000 6,000,000Buildings (net) 40,000,000 25,000,000 16,000,000Equipment (net) 25,000,000 10,000,000 2,000,000Total assets P 81,000,000 P 42,500,000Current liabilities P 4,000,000 P 1,500,000 1,500,000Long-term liabilities 20,000,000 10,000,000 12,000,000Common stocks, P10par 5,000,000 1,000,000Additional paid-incapital 40,000,000 20,000,000Retained earnings 12,000,000 10,000,000Total liabilities &equity P 81,000,000 P 42,500,000In addition to the above Sicle Co. has identifiable tangibles with a fair value of P5,000,000not recognize on its book but appropriately capitalize by Pop.On January 1, 20x6 Pop issues 400,000 shares of its stock, with a par value of P10/share anda market value of 100/share, to acquire Sicle Company’s…
- 10 Company A acquired 100% of Company B on January 1 2018 at a premium to book value and wants to prepare a consolidated balance sheet for the combined entity as of December 31, 2018 The financial statements for each individual entity are for the period ending December 31, 2018. Balance Sheet Company A Company B Sales 400,000 250,000 Cost of Goods Sold (150,000) (100,000) Depreciation (30,000) (25,000) Net Income 220,000 125,000 Statement of Retained Earnings Beginning Balance 230,000 100,000 Net Income 220,000 125,000 Ending Balance 450,000 225,000 Balance Sheet Totals Cash 20,000 40,000 Accounts Receivable 30,000 25,000 Inventory 60,000 60,000…1. S acquired 100 percent of F for P275,000. At the date of acquisition, F had the following book and market values: (see image below) What is the amount of the "Investment in F" account on S's financial records at the acquisition date? * Book Value Market Value P30,000 Cash and Receivables P30,000 100,000 210,000 Inventory Plant Assets (net) Current Liabilities 120,000 300,000 (45,000) (115,000) (45,000) (115,000) (10,000) (170,000) Long-term Debf Common Stock Retained EarningsSUBSEQUENT TO DATE OF ACQUISITION CHAPTER 3: CONSOLIDATION- 21. Patriotism Company purchased 70% of Strength Company on January 2, 2022 for P420,000. At that date Strength had inventory and plant assets with market values greater than book values in the amount of P50,000 and P90,000, respectively. The inventory and plant assets were assigned to have a remaining life of six months and five years, respectively. Strength Company has 2022 income and dividends of P160,000 and P60,000, respectively and 2023 income and dividends of P210,000 and P80,000, respectively. The balance of non-controlling interest account on December 31. 180,000 NU beg (420K 787. x30%.) 2023 must be: a. P223,200 b. P276,000 P169,200 с. d. P136,800 22. Jenny Company acquired 80% of the equity share capital of Smith
- M9-23 Assigning Purchase Price in Acquisitions Jasper Company acquired 80% of Fey Company at the beginning of the current year. Jasper paid $150,000 more than the book value of Eex's stockholders' equity and determined that this excess purchase price related to intangible assets. How does the $150,000 appear on the consolidated Jasper Company balance sheet if the intangible assets acquired related to (a) patents or, alternatively, (b) goodwill? How would each scenario affect the consolidated income statement?Purchase at More than Book Value Ramrod Manufacturing acquired all the assets and liabilities of Stafford Industries on January1 20X2, in exchange for 4,000 shares of Ramrod's $20 par value common stock. Balance sheet data for both companies just before the merger are given as follows: Stafford Industries Ramrod Manufacturing Book Value Fair Value Fair Value Balance Sheet Items Book Value $ 30,000 60,000 160,000 30,000 350,000 $ 30,000 60,000 100,000 40,000 400,000 (150,000) $ 480,000 $ 10,000 150,000 $ 70,000 100,000 200,000 50,000 600,000 (250,000) $770,000 70,000 100,000 375,000 80,000 540,000 Cash Accounts Receivable Inventory Land Buildings & Equipment Less: Accumulated Depreciation } $630,000 $ 10,000 145,000 Total Assets $1,165,000 Accounts Payable Bonds Payable Common Stock: $ 50,000 300,000 $ 50,000 310,000 200,000 $20 par value $5 par value Additional Paid-In Capital Retained Earnings 100,000 20,000 40,000 180,000 $770,000 200,000 $ 480,000 Total Liabilities & Equities %$4…ave & Exit Submit Check my work 7 Skipped McGuire Company acquired 90 percent of Hogan Company on January 1, 2022, for $234,000 cash. This amount is reflective of Hogan's total acquisition-date fair value. Hogan's stockholders' equity consisted of common stock of $160,000 and retained earnings of $80,000. An analysis of Hogan's net assets revealed the following: eBook Mc Graw Buildings (10-year life). Equipment (4-year life) Book Value $ 10,000 Fair Value 14,000 5,000 $ 8,000 18,000 12,000 Land Any excess consideration transferred over fair value is attributable to an unamortized patent with a useful life of 5 years. In consolidation at December 31, 2022, what adjustment is necessary for Hogan's Buildings account? Multiple Choice $1,620 increaseP3.4 Consolidated Balance Sheet Working Paper, Bargain Purchase On January 1, 2019, Paxon Corporation acquired all of the outstanding common stock of Saxon Company for $1.7 billion cash. The balance sheets of Paxon and Saxon, immediately prior to the combination, are shown below: Balance Sheets (in millions) Assets Cash and receivables. Inventory. Equity method investments Land.. Buildings and equipment, net Total assets Liabilities and Shareholders' Equity Current liabilities.. Long-term debt Common stock, par value Additional paid-in capital. Retained earnings Total liabilities and shareholders' equity Paxon (in millions) Inventory.. Equity method investments Land.... Buildings and equipment, net $2,860 1,700 - 650 2,400 $7,610 $1,500 2,000 500 1,200 2,410 $7,610 Saxon $ 720 900 300 175 600 $2,695 $1,000 400 100 350 845 $2,695 Several of Saxon's assets had fair values that were different from their book values. Estimates of the fair values of these items follow: Estimated Fair Value…Question 1Business combination valuation entries, pre-acquisition entriesOn 1 July 2016, Merelyn Ltd acquired all the issued shares of Cathy Ltd for $220 800. At this date theequity of Cathy Ltd consisted of share capital of $100 000 and retained earnings of $58 800. All theidentifiable assets and liabilities of Cathy Ltd were recorded at amounts equal to fair value except for:Carrying amount Fair valuePatent $70 000 $72 000Plant (net of $40 000 depreciation) 40 000 60 000Inventory 21 600 28 000The patent was considered to have an indefinite life. It was calculated that the plant had afurther life of 10 years, and was depreciated on a straight-line basis. All the inventory was soldby 30 June 2017. In June 2017, Cathy Ltd conducted an impairment test on the patent, as it wasconsidered to have an indefinite life, and the goodwill. As a result, the goodwill was consideredto be impaired by $1300.In May 2017, Cathy Ltd transferred $30 000 from the retained earnings on hand at 1 July 2016to…Peer, Inc. acquires 75 percent of Sea-breeze Corporation for P600,000 cash on January 1, 2016. The remaining percent of the Sea-breeze shares traded near a total value of 200,000 both before and after the acquisition date. NCI is measured on a full basis .On January 1, 2016, Sea-breeze had the following assets and liabilities: Book Value Fair Value Current Assets P 250,000 P 250,000 Land 100,000 100,000 Building (net) – 5-year-year life 400,000 350,000 Equipment (net) – 8-year life 300,000 400,000 Patent (10-year life) -0- 50,000 Accounts Payable (200,000) (200,000) Bonds Payable – 5-years (150,000) (175,000) Net P 700,000 P 775,000 Common Stock P 650,000 Retained Earnings P 50,000 The companies’ financial statements for the year ending December 31, 2016 using cost method are as follows: Peer Sea-Breeze Revenue P (800,000) P (250,000) Operating expenses…SEE MORE QUESTIONS