 |
|
| Browse | Ask | Answer | Search | Join/Login |
|
|
||||
|
advanced accounting homework help
Acquisition Problem
Below is a scenario for "Company P" acquiring "Company S". In this scenario, "Company P" can structure the transaction as either a direct purchase of the net assets of "Company S", or they may purchase 100% of the outstanding stock of "Company S". Under both scenarios, "Company P" will be paying $500,000 and will incur indirection acquisition costs of $10,000. Following is the balance sheet and fair market values for Company S" on the date of acquisition: Balance Sheet as of 6/30/13 Assets Liabilities & Owners' Equity Book Value Fair Market Value Book Value Fair Market Value Cash $0 $0 A/P $50,000 $50,000 A/R 50,000 40,000 Notes Payable75,000 75,000 Inventory 100,000 80,000 Bonds Payable 25,000 25,000 Net Machin & Equip100,000 150,000 Total Liabilities:$150,000 Net Buildings 50,000 100,000 Land 100,000 150,000 Common Stock 100,000 Patent 0 30,000 Retained Earnings150,000 Total Equity:$250,000 Total Assets: $400,000 Total Liabilities & O.E.: $400,000 A) Prepare the journal entry that would be made on the books of " on the date of acquisition: Balance Sheet as of 6/30/13 Assets Liabilities & Owners' Equity Book Value Fair Market Value Book Value Fair Market Value Cash $0 $0 A/P $50,000 $50,000 A/R 50,000 40,000 Notes Payable75,000 75,000 Inventory 100,000 80,000 Bonds Payable 25,000 25,000 Net Machin & Equip100,000 150,000 Total Liabilities:$150,000 Net Buildings 50,000 100,000 Land 100,000 150,000 Common Stock 100,000 Patent 0 30,000 Retained Earnings150,000 Total Equity:$250,000 Total Assets: $400,000 Total Liabilities & O.E.: $400,000 A) Prepare the journal entry that would be made on the books of " under an asset acquisition scenario: B) Prepare the journal entry that would be made on the books of " under an asset acquisition scenario: B) Prepare the journal entry that would be made on the books of " under an asset acquisition scenario: C) Prepare the journal entry that would be made on the books of " under an asset acquisition scenario: C) Prepare the journal entry that would be made on the books of " under a stock purchase scenario: |
||||
Check out some similar questions!
Mr. White (invested $20,000) and Mr. Black (invested $10,000) are in a partnership to run a marketing firm. They share profits and losses in the ratio of 2:1, which is also the ratio of their initial investment in the business. Mr. White manages the office but Mr. Black gets all of the contracts...
A golfball comes to rest 1.9 seconds after hitting a net. The force of the net slowed the ball down at a rate of 56.3\s exponent 2. What was the velocity of the ball when it first hit the net? Show your explanation please.
Cost method consolidated statements. The trial balances of Chango Company and its subsidiary, Lhasa Inc are as followson Dec 31 20x3 chango lhasa Current assets 530,000 130,000 Deprecialbe fixed assets 1,805,000 440,000 Accum depr (405,000) (70,000)...
Problem 10-7 in Advanced Accounting Concepts & Practice by Arnold J. Pahler, 9th edition: Question: Calculate the unrealized gain on the equipment transfer at the end of 2006 and prepare a matrix analysis to determine the unrealized profit on the current year inventory transfers. Prepare the...
View more questions Search
| Question Tools | Search this Question |
Add your answer here.
|
