2 3 On April 30, 2024, Cardamom Corporation acquired all of the outstanding common stock of Killarney 4 Corporation for $18,000,000 in cash. The book values and fair values of Killarney's assets and 5 liabilities were as follows: 6 7 Amount paid for all of the outstanding common stock 8 9 10 Current assets 11 Property, plant, and equipment 12 Other assets 13 Current liabilities 14 Long-term liabilities 15 16 Calculate the amount paid for goodwill. 17 18 Book Value $6,000,000 11,400,000 1,200,000 3,600,000 6,120,000 $18,000,000 Fair Value $7,800,000 14,820,000 1,560,000 3,600,000 5,810,000

2 3 On April 30, 2024, Cardamom Corporation acquired all of the outstanding common stock of Killarney 4 Corporation for $18,000,000 in cash. The book values and fair values of Killarney's assets and 5 liabilities were as follows: 6 7 Amount paid for all of the outstanding common stock 8 9 10 Current assets 11 Property, plant, and equipment 12 Other assets 13 Current liabilities 14 Long-term liabilities 15 16 Calculate the amount paid for goodwill. 17 18 Book Value $6,000,000 11,400,000 1,200,000 3,600,000 6,120,000 $18,000,000 Fair Value $7,800,000 14,820,000 1,560,000 3,600,000 5,810,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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26. Johnson Corporation acquired all of the outstanding common stock of Smith Corporation for $13,280,000 in cash. The book value of Smith’s net assets (assets minus liabilities) was $9,700,000. The fair values of all of Smith’s assets and liabilities were equal to their book values with the following exceptions: Book Value Fair Value Receivables $ 3,200,000 $ 2,810,000 Property, plant, and equipment 9,900,000 11,490,000 Intangible assets 390,000 1,580,000 Required:Calculate the amount paid for goodwill.
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L2-4 Awe Company pays CU500,000,000 for a 30% interest in Groy Company on July 1, 19x2 when the book value of Groy Company's net assets equals fair value. Awe Company amortizes any goodwill from this investment over 20 years. Information related to Groy Company is as follows: 31 Desember 19x1 31 Desember 19x2 Share capital, nominal IDR 1,000 Rp600.000.000 Rp600.000.000 Retained earning 400.000.000 500.000.000 Total Shareholders' Equity 1.000.000.000 1.100.000.000 Net profit earned during the year 19x2 200.000.000 Dividend for the year 19x2 (paid on March 1 of Rp. 50,000,000 and September 1 of Rp. 50,000,000) 100.000.000 Required: calculate Awe Company's revenue from Groy Company for the year 19x2
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Accounting On January 1, 2022, Pronto Company acquired all of Speedy Inc.'s voting stock for $28,800,000. Speedy's net assets were reported at amounts approximating book value, but Pronto determined that Speedy had the following previously unreported intangible assets: Developed technology, fair value $2,400,000, 5-year life • Favorable leases, fair value $1,200,000, 4-year life ● Speedy's shareholders' equity on January 1, 2022, was $12,000,000. It is now December 31, 2023 (two years later). Speedy reported net income of $960,000 in 2022. There are no impairments of identifiable intangibles or goodwill in 2022 or 2023. Pronto uses the complete equity method to report its investment in Speedy on its own books. Speedy's December 31, 2023, trial balance appears below. Dr (Cr) $24,000,000 Current assets Property and equipment, net 60,000,000 Liabilities (69,600,000) Capital stock (2,400,000) Retained earnings, January 1 (10,560,000) Sales revenue (84,000,000) Cost of goods sold 72,000,000…
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Question 2 Piz.5 L03.) (Goodwill, Impairment) On July 31, 2022. Mexico Company paid Se o00.o00 to acquire all of the ordinary shares of Condhita Incorporated, which became a division (cash-generating unit of Mexico. Conchita reported the following statement of financial position at the time of the acquisition $2.400,000 Non-current assets S2,700,000 Equity Current assets Total assets Soo,000 Non-curent liabihties $3.500,000 Current liabilities 500,000 600.000 Total equity and liabilities S3.500,000 It was determined at the date of the purchase that the fair value of the identifiable net assets of Conchita was S2-750,000.Over the next6 months of operations, the newly purchased division experienced operating losses. In addition, it now appears that it will generate substantial losses for the foreseeable future. At December g1, 2022, Conchita reports the following statement of financial position information S 450,000 Current assets Non-eurrent assets (including goodwill recognized ia…
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9. Busquets Plc. acquired 100% of Neymar Ltd. in 2022. The table below reports the book value and the fair value of the assets and liabilities of Neymar Ltd. at the time of the acquisition: Amounts in £ Cash Accounts receivable PPE Liabilities Book value ANSWER: D 200 100 500 50 Fair value 200 180 750 70 Busquets Plc. paid £2,000 in cash for Neymar and there were no costs associated with the acquisition. As a result of the acquisition, the total assets of Busquets Plc. a. Increase by £2,000 b. Decrease by £2,000 c. Do not change d. Increase by £70 e. None of the above