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Blank Corporation acquired 100 percent of Faith Corporation's common stock on December 31, 20X2, for $216,000. Data from the balance sheets of the two companies included the following amounts as of the date of acquisition: Item Assets Cash Accounts Receivable Inventory Buildings and Equipment (net) Investment in Faith Corporation Stock Total Assets Liabilities and Stockholders' Equity Accounts Payable Notes Payable Common Stock Retained Earnings Total Liabilities and Stockholders' Equity Blank Corporation Faith Corporation $ 57,000 78,000 106,000 219,000 216,000 $ 676,000 $ 87,000 150,000 89,000 350,000 $ 36,000 50,000 71,000 150,000 $ 307,000 $ 19,000 72,000 50,000 166,000 $ 676,000 $ 307,000 At the date of the business combination, the book values of Faith's net assets and liabilities approximated fair value. Assume that Faith Corporation's accumulated depreciation on buildings and equipment on the acquisition date was $22,000. Required: a. Give the consolidation entry or entries needed to prepare a consolidated balance sheet immediately following the business combination. b. Prepare a consolidated balance sheet worksheet.

Blank Corporation acquired 100 percent of Faith Corporation's common stock on December 31, 20X2, for $216,000. Data from the balance sheets of the two companies included the following amounts as of the date of acquisition: Item Assets Cash Accounts Receivable Inventory Buildings and Equipment (net) Investment in Faith Corporation Stock Total Assets Liabilities and Stockholders' Equity Accounts Payable Notes Payable Common Stock Retained Earnings Total Liabilities and Stockholders' Equity Blank Corporation Faith Corporation $ 57,000 78,000 106,000 219,000 216,000 $ 676,000 $ 87,000 150,000 89,000 350,000 $ 36,000 50,000 71,000 150,000 $ 307,000 $ 19,000 72,000 50,000 166,000 $ 676,000 $ 307,000 At the date of the business combination, the book values of Faith's net assets and liabilities approximated fair value. Assume that Faith Corporation's accumulated depreciation on buildings and equipment on the acquisition date was $22,000. Required: a. Give the consolidation entry or entries needed to prepare a consolidated balance sheet immediately following the business combination. b. Prepare a consolidated balance sheet worksheet.

FINANCIAL ACCOUNTING
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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Blank Corporation acquired 100 percent of Faith Corporation's common stock on December 31, 20X2, for $216,000. Data from the balance sheets of the two companies included the following amounts as of the date of acquisition: Item Assets Cash Accounts Receivable Inventory Buildings and Equipment (net) Investment in Faith Corporation Stock Total Assets Liabilities and Stockholders' Equity Accounts Payable Notes Payable Common Stock Retained Earnings Total Liabilities and Stockholders' Equity Blank Corporation Faith Corporation $ 57,000 78,000 106,000 219,000 216,000 $ 676,000 $ 87,000 150,000 89,000 350,000 $ 36,000 50,000 71,000 150,000 $ 307,000 $ 19,000 72,000 50,000 166,000 $ 676,000 $ 307,000 At the date of the business combination, the book values of Faith's net assets and liabilities approximated fair value. Assume that Faith Corporation's accumulated depreciation on buildings and equipment on the acquisition date was $22,000. Required: a. Give the consolidation entry or entries needed to prepare a consolidated balance sheet immediately following the business combination. b. Prepare a consolidated balance sheet worksheet.
Transcribed Image Text:Blank Corporation acquired 100 percent of Faith Corporation's common stock on December 31, 20X2, for $216,000. Data from the balance sheets of the two companies included the following amounts as of the date of acquisition: Item Assets Cash Accounts Receivable Inventory Buildings and Equipment (net) Investment in Faith Corporation Stock Total Assets Liabilities and Stockholders' Equity Accounts Payable Notes Payable Common Stock Retained Earnings Total Liabilities and Stockholders' Equity Blank Corporation Faith Corporation $ 57,000 78,000 106,000 219,000 216,000 $ 676,000 $ 87,000 150,000 89,000 350,000 $ 36,000 50,000 71,000 150,000 $ 307,000 $ 19,000 72,000 50,000 166,000 $ 676,000 $ 307,000 At the date of the business combination, the book values of Faith's net assets and liabilities approximated fair value. Assume that Faith Corporation's accumulated depreciation on buildings and equipment on the acquisition date was $22,000. Required: a. Give the consolidation entry or entries needed to prepare a consolidated balance sheet immediately following the business combination. b. Prepare a consolidated balance sheet worksheet.
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