None Chapter 3 QuizOn January 1, 2XX0, Cheap Camera Corp. paid $3,080,000 to acquire Worldwide Photo, Inc. Cheap Camera used the equity method to account for theinvestment. The following information is available for the assets, liabilities, and stockholders' equity accounts of Worldwide Photo:Book Value Fair Value$880,000$880,000Current assetsLandBuilding (twenty-year life)380,000 480,0001,020,000 1,240,000Equipment (five-year life)740,000 760,000Current liabilitiesLong-term liabilities160,000 160,000260,000 260,000Common stock560,000Additional paid-in capital1,200,000Retained earnings840,000Worldwide Photo earned net income for 2XX0 of $500,000 and paid dividends of $72,000 during the year.The 2XX0 consolidation entry to reverse Cheap Camera's recognition of Worldwide Photo's income and dividends in the current year would include a netcredit to Equity Investment for:Select one:a. $428,000 xb. $72,000O11:47 AM5/14/2024

Therefore, the consolidation entry to reverse Cheap Camera's recognition of Worldwide Photo's income…

Answered: Chapter 3 Quiz On January 1, 2XX0,…

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

Chapter14: Intercorporate Investments In Common Stock

Section: Chapter Questions

Problem 16E

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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 $1,620 increase
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Problem 1Parekoy Company acquires 150,000 of the 1,000,000 Marekoy Company’s common stock for P500,000 cash and carries the investment as a financial asset. A few months later, Parekoypurchases another 600,000 of Marekoy Company’s stock for P2,160,000. At that date, Marekoy Company reports identifiable assets with a book value of P3,900,000 and a fair value of P5,100,000, and it has liabilities with a book value and fair value of P1,900,000. The fair value of the non-controlling interest in Marekoy Company is P900,000. 1.Non-controlling interest arising on consolidation is to be valued on the full (fair value) basis or “Full/Gross-up” Goodwill:a. P300,000b. P500,000c. P800,000d. P900,0002. The remeasurement gain or loss to be recognized to profit and loss account if the 15% ownership is a FVTPL (fair value through profit and loss)when the additional shares are acquired:a. Zerob. P40,000 gainc. P40,000 lossd. P68,000 loss3. The remeasurement gain or loss to be recognized to profit or…
You're given the following details of an acquisition of Target Co. by Acquirer Ltd.. What is the transaction value for this acquisition of Target Co.? Acquisition of Target Co. by Acquirer Ltd. Target Share Price ($/sh.) $85.40 Acquisition Premium 15% Diluted Shares Outstanding (MM) 670 Target Total Debt Target Cash and Cash Equivalents % Debt Financing % Equity Financing Equity Financing Fees Debt Financing Fees Other Transaction Costs $3,562 $5,147 40% 60% 4.0% 1.5% $800
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On April 1, 20x8 Phar acquired 90% of the Equity Shares of Star. Star retained profits at the date of acquisition were $ 2, 640,000. Balance Sheet as at 31 March 20x9. Phar Star $000 $000 $000 $000 Non-Current Assets PPE 2,544 2,388 Intangible Software - 2,520 Investments-Equity in Star 5, 036 - Others 214 252 7,794 5,160 Current Assets Inventories 863 672 Receivables 629 394 Stars Current Account 90 - Cash 24 - 1,606 1,066 9,400 6,226 Capital and Reserves Equity shares of $1 each 2,400 1,800 Share Premium 2,400…
Question 2 Nick Ltd acquired 100% of the issued capital of Wing Ltd on 1 July 2011 for $270000. The statements of financial position of the companies immediately after the acquisition are provided below. All assets have been reported following fair value. Statement of Financial Position For the year ended 1 July 2011 Nick Ltd Wing Ltd $ S Shareholders' equity Share capital 450,000 180,000 General reserve 45,000 25,000 Retained earnings 140,000 20,000 Total shareholders' equity 635,000 225,000 Assets Current assets Cash at Bank 50,000 30,000 Accounts Receivable 20,000 10,000 Inventory 100,000 25.000 170,000 65,000 Non-current assets Investment in Wing Ltd 270,000 Land 250,000 200,000 Plant & Equipment 100,000 80.000 620,000 280,000 Total assets 790,000 345,000 Liabilities Current liabilities Accounts Payable 40,000 10,000 Interest Payable 55,000 18,000 Non-current liabilities Bank loan 100,000 102,000 Total liabilities 155,000 120,000 Net assets 635,000 225,000 Required 1. Calculate…
Problem 3) On January 1, 20X7, Falcon acquired the net assets of Intra for $3,400,000 with the issue of shares. The statement of financial position for Intra at the date of acquisition is shown below, together with estimates of the fair values of Intra's recorded assets and liabilities. Intra Corp Statement of Financial Position as at December 31, 20X6 Assets Cash Accounts receivable Inventories Property, plant, and equipment Development projects Other investments Total assets Liabilities Accounts payable and accrued liabilities Long-term debt Common shares Retained earnings Total liabilities and shareholders' equity Book value $ 000's 350 180 330 3,465 150 20 4,495 180 680 1,525 2,110 4,495 Fair value $ 000's 350 170 310 3,155 565 45 180 660 Required: a) What is the amount of goodwill to be recorded for this business combination? b) Prepare the journal entry that Falcon will use to record the business combination. Prepare the statement of financial position for Intra on January 1,…
Elston Company Balance Sheet December 31, 2004 Assets 800,000 Liabilities 100,000 Capitalstock 400,000 Retainedearnings 300,000 Totalequities 800,000 Alley Company Balance Sheet December 31, 2004 Assets 600,000 Liabilities 150,000 Capitalstock 370,000 Retainedearnings 80,000 Totalequities 600,000 1. If Elston Company acquired a 20% interest in Alley Company on December 31, 2004 for $130,000 and the fair value method of accounting for the investment were used, the amount of the debit to Investment in Alley Company Stock would have been $90,000. $74,000. $130,000. $120,000. 2. If Elston Company acquired a 30% interest in Alley Company on December 31, 2004 for $150,000 and the equity method of accounting for the investment were used, the amount of the debit to Investment in Alley Company Stock would have been $190,000. $150,000. $120,000. $135,000. 3. If Elston Company acquired a 20% interest in Alley Company on December 31, 2003 for $90,000 and during 2005 Barnes…
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