ABC purchased 80% of the voting shares of XYZ Ltd. on Jan.1.2022 for $669,200. Assets Cash Inventory Land Property, Plant, and Equipment Total Assets Liabilities Accounts Payable Shareholders' Equity Preferred Shares Common Shares Retained Earnings Total Liabilities and Shareholders' Equity Book Value $38,000 $207,000 $195,000 $1,010,000 $1,450,000 $100,000 $450,000 $750,000 $150,000 $1,450,000 Fair Value $38,000 $252,000 $195,000 $900,000 $1,385,000 $100,000 The preferred shares are non-voting and are entitled to 10% cumulative dividends. On Jan.1.2022, there were cumulative dividends in arrears of $45,000, which were paid in 2022. The preferred shares carried a call premium of 8% of face value. Property, plant and equipment have a remaining useful life of 10 years. Goodwill was impaired by $41,125 for 2022. ABC records its Investment in XYZ using the COST METHOD. 1) What are the balances of Goodwill, Property, Plant and Equipment and Inventory on Dec.31. 2022
ABC purchased 80% of the voting shares of XYZ Ltd. on Jan.1.2022 for $669,200. Assets Cash Inventory Land Property, Plant, and Equipment Total Assets Liabilities Accounts Payable Shareholders' Equity Preferred Shares Common Shares Retained Earnings Total Liabilities and Shareholders' Equity Book Value $38,000 $207,000 $195,000 $1,010,000 $1,450,000 $100,000 $450,000 $750,000 $150,000 $1,450,000 Fair Value $38,000 $252,000 $195,000 $900,000 $1,385,000 $100,000 The preferred shares are non-voting and are entitled to 10% cumulative dividends. On Jan.1.2022, there were cumulative dividends in arrears of $45,000, which were paid in 2022. The preferred shares carried a call premium of 8% of face value. Property, plant and equipment have a remaining useful life of 10 years. Goodwill was impaired by $41,125 for 2022. ABC records its Investment in XYZ using the COST METHOD. 1) What are the balances of Goodwill, Property, Plant and Equipment and Inventory on Dec.31. 2022
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:ABC purchased 80% of the voting shares of XYZ
Ltd. on Jan.1.2022 for $669,200.
Assets
Cash
Inventory
Land
Property, Plant, and Equipment
Total Assets
Liabilities
Accounts Payable
Shareholders' Equity
Preferred Shares
Common Shares
Retained Earnings
Total Liabilities and Shareholders' Equity
Book Value
$38,000
$207,000
$195,000
$1,010,000
$1,450,000
$100,000
$450,000
$750,000
$150,000
$1,450,000
Fair Value
$38,000
$252,000
$195,000
$900,000
$1,385,000
$100,000
The preferred shares are non-voting and are
entitled to 10% cumulative dividends.
On Jan.1.2022, there were cumulative dividends
in arrears of $45,000, which were paid in 2022.
The preferred shares carried a call premium of
8% of face value.
Property, plant and equipment have a remaining
useful life of 10 years.
Goodwill was impaired by $41,125 for 2022.
ABC records its Investment in XYZ using the
COST METHOD.
1) What are the balances of Goodwill, Property,
Plant and Equipment and Inventory on Dec.31.
2022
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