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During purchase negotiations, Miller's plant assets were appraised at $425,000 and all of its remaining assets and liabilities were appraised at values approximating their book values. Healy also concluded that an additional $75,000 (for goodwill) demanded by Miller's shareholders was warranted because Miller's earning power was better than the industry average. Prepare the consolidating adjustments and the consolidated balance sheet at acquisition. Use negative signs with consolidating adjustment answers, when appropriate. Healy Miller Consolidating Consolidated Company Company Adjustments Balance Sheet $1,800,000 $90,000 0 $1,890,000 ✓ 500,000 0✓ 3,000,000 410,000 Current assets Investment in Miller Plant assets, net Goodwill Total assets Liabilities Contributed capital Retained earnings Total liabilities & stockholders' equity $5,300,000 $5,300,000 $500,000 $700,000 $90,000 3,600,000 370,000 1,000,000 40,000 $500,000 (500,000)✓ 15,000 ✓ 75,000 ✓ 3,425,000✔ 75,000 ✓ $5,800,000 x 0 x 0 x 0 x 0x 0 $ 0x 0x $

During purchase negotiations, Miller's plant assets were appraised at $425,000 and all of its remaining assets and liabilities were appraised at values approximating their book values. Healy also concluded that an additional $75,000 (for goodwill) demanded by Miller's shareholders was warranted because Miller's earning power was better than the industry average. Prepare the consolidating adjustments and the consolidated balance sheet at acquisition. Use negative signs with consolidating adjustment answers, when appropriate. Healy Miller Consolidating Consolidated Company Company Adjustments Balance Sheet $1,800,000 $90,000 0 $1,890,000 ✓ 500,000 0✓ 3,000,000 410,000 Current assets Investment in Miller Plant assets, net Goodwill Total assets Liabilities Contributed capital Retained earnings Total liabilities & stockholders' equity $5,300,000 $5,300,000 $500,000 $700,000 $90,000 3,600,000 370,000 1,000,000 40,000 $500,000 (500,000)✓ 15,000 ✓ 75,000 ✓ 3,425,000✔ 75,000 ✓ $5,800,000 x 0 x 0 x 0 x 0x 0 $ 0x 0x $

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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21.

During purchase negotiations, Miller's plant assets were appraised at $425,000 and all of its remaining assets and liabilities were appraised at values approximating their book values. Healy also concluded that an additional $75,000 (for goodwill) demanded by Miller's shareholders was warranted because Miller's earning power was better than the industry average. Prepare the consolidating adjustments and the consolidated balance sheet at acquisition. Use negative signs with consolidating adjustment answers, when appropriate. Healy Miller Consolidating Consolidated Company Company Adjustments Balance Sheet $1,800,000 $90,000 $1,890,000 ✓ 0✔ 3,425,000 ✓ 75,000 ✓ 5,800,000 x 0 x 0 x 0 x 0 x Current assets Investment in Miller Plant assets, net Goodwill Total assets Liabilities Contributed capital Retained earnings Total liabilities & stockholders' equity $5,300,000 Check 500,000 3,000,000 410,000 $5,300,000 $500,000 $ 700,000 $ 90,000 3,600,000 370,000 1,000,000 40,000 $500,000 0 (500,000)✓ 15,000 ✓ 75,000 ✓ $ 0✔ $ 0 x 0 x $
Transcribed Image Text:During purchase negotiations, Miller's plant assets were appraised at $425,000 and all of its remaining assets and liabilities were appraised at values approximating their book values. Healy also concluded that an additional $75,000 (for goodwill) demanded by Miller's shareholders was warranted because Miller's earning power was better than the industry average. Prepare the consolidating adjustments and the consolidated balance sheet at acquisition. Use negative signs with consolidating adjustment answers, when appropriate. Healy Miller Consolidating Consolidated Company Company Adjustments Balance Sheet $1,800,000 $90,000 $1,890,000 ✓ 0✔ 3,425,000 ✓ 75,000 ✓ 5,800,000 x 0 x 0 x 0 x 0 x Current assets Investment in Miller Plant assets, net Goodwill Total assets Liabilities Contributed capital Retained earnings Total liabilities & stockholders' equity $5,300,000 Check 500,000 3,000,000 410,000 $5,300,000 $500,000 $ 700,000 $ 90,000 3,600,000 370,000 1,000,000 40,000 $500,000 0 (500,000)✓ 15,000 ✓ 75,000 ✓ $ 0✔ $ 0 x 0 x $
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