Homework Help is Here – Start Your Trial Now!
Business
Accounting
acquisition of Soda's stock on Pop's books. y entries that would be made on Soda's books general journal form, all consolidation entries ary prepared immediately following the combi

acquisition of Soda's stock on Pop's books. y entries that would be made on Soda's books general journal form, all consolidation entries ary prepared immediately following the combi

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
See similar textbooks
icon
Related questions
Question

PLEASE HELP ME 

Required a. Record the acquisition of Soda's stock on Pop's books. b. Present any entries that would be made on Soda's books related to the business combination, assuming push-down accounting is used. c. Present, in general journal form, all consolidation entries that would appear in a consolidation worksheet for Pop Company and its subsidiary prepared immediately following the combination.
Transcribed Image Text:Required a. Record the acquisition of Soda's stock on Pop's books. b. Present any entries that would be made on Soda's books related to the business combination, assuming push-down accounting is used. c. Present, in general journal form, all consolidation entries that would appear in a consolidation worksheet for Pop Company and its subsidiary prepared immediately following the combination.
Pop Company acquired all of Soda Corporation's common shares on January 2, 20X3, for $789,000. At the date of combination, Soda's balance sheet appeared as follows: Assets. Cash & Receivables Inventory Land Buildings (net) Equipment (net) $ 34,000 165,000 60,000 250,000 320,000 Liabilities $829,000 Current Payables Notes Payable Stockholders Equity Common Stock Additional Capital Retained Earnings $ 25,000 100,000 Total The fair values of all of Soda's assets and liabilities were equal to their book values except for its fixed assets. Soda's land had a fair value of $75,000; the buildings had a fair value of $300,000; and the equipment had a fair value of $340,000. Total 200,000 425,000 79,000 $ 829,000 Pop Company decided to employ push-down accounting for the acquisition of Soda Corporation. Subsequent to the combination, Soda continued to operate as a separate company.
Transcribed Image Text:Pop Company acquired all of Soda Corporation's common shares on January 2, 20X3, for $789,000. At the date of combination, Soda's balance sheet appeared as follows: Assets. Cash & Receivables Inventory Land Buildings (net) Equipment (net) $ 34,000 165,000 60,000 250,000 320,000 Liabilities $829,000 Current Payables Notes Payable Stockholders Equity Common Stock Additional Capital Retained Earnings $ 25,000 100,000 Total The fair values of all of Soda's assets and liabilities were equal to their book values except for its fixed assets. Soda's land had a fair value of $75,000; the buildings had a fair value of $300,000; and the equipment had a fair value of $340,000. Total 200,000 425,000 79,000 $ 829,000 Pop Company decided to employ push-down accounting for the acquisition of Soda Corporation. Subsequent to the combination, Soda continued to operate as a separate company.
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Financial Reporting in Hyperinflationary Economies
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education
SEE MORE TEXTBOOKS