Allerton Company acquires all of Deluxe Company's assets and liabilities for cash on January 1, 2024, and subsequently formally dissolves Deluxe. At the acquisition date, the following book and fair values were available for the Deluxe Company accounts: Items Current assets Building Land Trademark Goodwill Liabilities Common stock Retained earnings View transaction list Required: a. and b. Prepare Allerton's journal entry to record its acquisition of Deluxe in its accounting records assuming the following cash exchange amounts: $157,000 and $92,000. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Journal entry worksheet < Book Values Fair Values $ 51,500 92,750 27,000 0 21,000 (57,250) (100,000) (35,000) 1 2 $ 51,500 44,250 43,000 39,000 ? (57,250) 0 0 Note: Enter debits before credits. Record the acquisition of Deluxe assuming the cash exchange of $157,000. < Prev 4 of 4 B > Next >

Allerton Company acquires all of Deluxe Company's assets and liabilities for cash on January 1, 2024, and subsequently formally dissolves Deluxe. At the acquisition date, the following book and fair values were available for the Deluxe Company accounts: Items Current assets Building Land Trademark Goodwill Liabilities Common stock Retained earnings View transaction list Required: a. and b. Prepare Allerton's journal entry to record its acquisition of Deluxe in its accounting records assuming the following cash exchange amounts: $157,000 and $92,000. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Journal entry worksheet < Book Values Fair Values $ 51,500 92,750 27,000 0 21,000 (57,250) (100,000) (35,000) 1 2 $ 51,500 44,250 43,000 39,000 ? (57,250) 0 0 Note: Enter debits before credits. Record the acquisition of Deluxe assuming the cash exchange of $157,000. < Prev 4 of 4 B > Next >

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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CASE 1 Presented below are the financial balances for the BonGiovi Company and the Terens Company as of December 31, 2017, immediately before BonGiovi acquired Terens. Also included are the fair values for Terens Company's net assets at that date (thousands of US$). Compute the consolidated cash upon completion of the acquisition. BonGiovi Book Value Terens Book Value 31.12.2017 31.12.2017 Terens Fair Value 31.12.2017 Cash 870 240 240 Receivables 660 600 600 Inventory 1,230 420 580 Land 1,800 260 250 Buildings (Net) 1,800 540 650 Equipment (net) 660 380 400 Accounts Payable (570) (240) (240) A) $1,350. Accrued expenses (270) Long term Liabilities (2,700) (60) (1,020) (60) (1,120) B) $1,110. Common Stock (1,980) ($20par) C) $1,080. Common Stock ($5 (420) par) D) $1,085. Additional paid in (210) (180) E) $ 635. capital Retained earnings (1,170) (480) Revenue (2,880) (660) Expenses 2,760 620 Note: Parenthesis indicates a credit balance Assume a business combination took place at December…
In a pre-2009 business combination, Acme Company acquired all of Brem Company's assets and liabilities for cash. After the combination, Acme formally dissolved Brem. At the acquisition date, the following book and fair values were available for the Brem Company accounts: Items Current assets Equipment Trademark Liabilities View transaction list Book Values $ 88,400 131,000 Common stock Retained earnings In addition, Acme paid an investment bank $29,200 cash for assistance in arranging the combination. (74,400) (100,000) (45,000) Required: a. Using the legacy purchase method for pre-2009 business combinations, prepare Acme's entry to record its acquisition of Brem in its accounting records assuming the cash amounts of $668,400 and $457,400 were paid to the former owners of Brem. b. How would these journal entries change if the acquisition occurred post-2009 and therefore Acme applied the acquisition method? Note: If no entry is required for a transaction/event, select "No Journal entry…
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Acquisition Entries, Acquisition Costs, Bargain Gain Plastic Corporation is contemplating a business combination with Steel Corporation at December 31, 2021. Steel's condensed balance sheet on that date appears below: Assets Cash and receivables Inventory Equity method investments Land Buildings and equipment Patents Total assets Liabilities and Stockholders' Equity Liabilities Common stock Retained earnings Total liabilities and equity Cash and receivables Inventory Equity method investments Land Description Buildings and equipment Patents Goodwill Liabilities Required Prepare the journal entry to record the business combination of Plastic and Steel for each of the following acquisition costs and combination methods. (a) Plastic acquires Steel as a merger for $250,000 cash. Other direct cash acquisition costs are $20,000. General Journal Description Cash and receivables Inventory Equity method investments. Land Liabilities Cash Buildings and equipment Patents ÷ Description (b) Plastic…
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