8. Nail Bite Co. acquired land with fair value of $4,000,000 in exchange for Nail Bite's10,000 shares with par value of $40 per share and quoted price of $360 per share.How much gain (loss) should Nail Bite Co. recognize on the exchange?a. 3,200,000b. 400,000c. (400,000)d. 0

Gain on the exchange can be calculated by deducting the market value of share from the fair value of…

8. Nail Bite Co. acquired land with fair value of $4,000,000 in exchange for Nail Bite's 10,000 shares with par value of P40 per share and quoted price of P360 per share. How much gain (loss) should Nail Bite Co. recognize on the exchange? a. 3,200,000 c. (400,000) d. 0 b. 400,000

8. Nail Bite Co. acquired land with fair value of $4,000,000 in exchange for Nail Bite's 10,000 shares with par value of P40 per share and quoted price of P360 per share. How much gain (loss) should Nail Bite Co. recognize on the exchange? a. 3,200,000 c. (400,000) d. 0 b. 400,000

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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Urmila ben
On December 18, 2020, Stephanie Corporation acquired 100 percent of a Swiss company for 4.002 million Swiss francs (CHF), which is indicative of book and fair value. At the acquisition date, the exchange rate was $1.00 = CHF 1. On December 18, 2020, the book and fair values of the subsidiary’s assets and liabilities were as follows: Cash CHF 802,000 Inventory 1,302,000 Property, plant, and equipment 4,002,000 Notes payable (2,104,000 ) Stephanie prepares consolidated financial statements on December 31, 2020. By that date, the Swiss franc has appreciated to $1.10 = CHF 1. Because of the year-end holidays, no transactions took place prior to consolidation. Determine the translation adjustment to be reported on Stephanie’s December 31, 2020, consolidated balance sheet, assuming that the Swiss franc is the Swiss subsidiary’s functional currency. What is the economic relevance of this translation adjustment? Determine the remeasurement gain or loss…
3. Please help me to answer this with solution. thank you
If H Ltd purchased 75% of the shares of S Ltd at a price of Rs 110,000, when S Ltd's share capital was Rs 60,000 and its accumulated profits amounted to Rs 80,000, what was the goodwill paid by H Ltd O a. Rs 5,000 O b. Rs 10,000 O c. Rs 15,000 d. None of the options
On January 1, 20X1, Prime Company purchased all the outstanding stock of Spring Company, located in Canada, for $137,700. On January 1, 20X1, the direct exchange rate for the Canadian dollar (C$) was C$1 = $0.81. Spring's book value on January 1, 20X1, was C$96,000. On January 1, 20X1, the book value of the Spring's identifiable assets and liabilities approximated their fair values except for property, plant, and equipment. The remaining useful life of Spring's property, plant and equipment at January 1, 20X1, was 10 years. During 20X1, Spring earned C$24,000 in income and declared and paid C$7,400 in dividends. The dividends were declared and paid in Canadian dollars when the exchange rate was C$1 = $0.75. On December 31, 20X1, Prime continues to hold the Canadian currency received from the dividend. On December 31, 20X1, the direct exchange rate is C$1 = $0.64. The average exchange rate during 20X1 was C$1 = $0.76. Management has determined that the Canadian dollar is Spring's…
9. Albert transfers land (basis of S140,000 and fair market value of $320,000) to Gold Corporation for 80% of its stock Albert's basis in stock received is . a. Albert has a recognized gain on the transfer of $140,000. b. Albert has a basis of $140,000 c. Albert has a basis of $320,000. d. Gold Corporation has a basis in the land of $220,000. e. None of the above. 10. Rhonda and Marta form Blue Corporation. Rhonda transfers land (basis of $60,00 and fair market value of $180,000) for 50 shares plus $20,000 cash. Marta transfers $160,000 cash for 50 shares in Blue Corporation. a. Rhonda's basis in the Blue Corporation stock is $60,00. b. Blue Corporation's basis in the land is $55,000. c. Blue Corporation's basis in the land is $180,000. d. Rhonda recognizes a gain on the transfer of $125,000. c. None of the above.
XYZ Ltd acquires 100 per cent of Red-X Ltd on 1 July 2021. XYZ Ltd pays the shareholders of Red-X Ltd the following consideration: Cash 70 000 Plant and equipment fair value $250 000; carrying amount in the books of ABC Ltd $170 000 Land fair value $300 000; carrying amount in the books of ABC Ltd $200 000 There are also legal fees of $190 000 involved in acquiring Red-X Ltd. On 1 July 2021 Red-X Ltd’s statement of financial position shows total assets of $300 000 and liabilities of $300 000. The fair value of the assets is $800 000. Required: Has any goodwill been acquired and, if so, how much? And discuss the potential for including associated legal fees into the cost of acquiring Red-X using appropriate accounting standard.
Question1 a) On 31 December 2018 Pee Plc purchased 80% of the share capital of Cee Ltd for £60,000 when its accumulated profits were £30,000. The individual Statement of Financial Positions of PeePlc and CeeLtdat 31December2020were as follows: Рее Cee Cee Ltd £ £ Non-current assets: Property, plant and equipment 160,000 50,000 Cost of investment 60,000 00000 220,000 50,000 Current assets 30.000 10,000 Total assets 250,000 60,000 Equity and liabilities Ordinarysharesof£leach 100,000 20,000 Retained profits 150,000 40,000 250,000 60,000 Consolidated goodwill is subject to an annual impairment review. No impairment has been detected to date. Required: Prepared the consolidated statement of financial position for the Pee group at 31 December 2020. Pee plc has a policy of valuing Non-Controlling interest at their share of net assets at acquisition.
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B8.
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