Financial Accounting problem Financial Accounting Problem 6.2.11Prior to being united in a business combination, Peru Inc. and Vital Corp.had the following stockholders' equity figures:PeruVitalCommon stock ($1 par value)Additional paid-in capital$220,000 $54,000$110,000 $25,000$360,000 $130,000Retained earningsPeru issued 62,000 new shares of its common stock valued at $4.77 per sharefor all of the outstanding stock of Vital.Assume that Peru acquired Vital on January 1, 2012. At what amount didPeru record the investment in Vital?

Concept of Business Combination:A business combination occurs when one company acquires control over…

Answered: Financial Accounting Problem 6.2.11…

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

Chapter14: Intercorporate Investments In Common Stock

Section: Chapter Questions

Problem 30P

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Problem #9 Entries for Share Dividends E Tan Med-Care Inc. is a health insurance corporation. The following account balances appear on the statement of financial position of E. Tan Med-Care Inc.: Ordinary Shares (50,000 shares authorized), P10 par, P400,000; Share Premium-Ordinary, P42,500, and Retained Earnings, P299,500. The board of directors declared a 4% share dividend when the market price of the stock was P15 a share. Required: 1. Journalize the entries to record a. the declaration of the dividend. b. the issuance of the shares. 2. Determine the following amounts before the share dividend was declared: a. total share capital b. total retained earnings c. total shareholders' equity 3. Determine the following amounts after the share dividend was declared: a. total share capital b. total retained earnings c. total shareholders' equity
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If Company A invested $70,000 cash in Company B (a newly created subsidiary) with Company B issuing 1000 share of $5 par value common stock to the Parent Company. What is the credit item in the Parent Company Stock 70,000 Investment in B Company 70,000 Stock $5,000 and Paid-In-Capital $65,000 Cash 70,000
Consider the following premerger information about Firm X and Firm Y: 222 Total earnings Shares outstanding Per-share values: Market Book Firm X $92,000 49,000 Assets from X Assets from Y Goodwill Total Assets XY LA GA Firm Y $20,500 14,000 49 $ 18 $ 20 7 zursurch of M www.am entrat human pa grawe anakmuom 2 Hoe o Assume that Firm X acquires Firm Y by paying cash for all the shares outstanding at a merger premium of $7 per share, and that neither firm has any debt before or after the merger. Construct the postmerger balance sheet for Firm X assuming the use of the purchase accounting method. (Do not round intermediate calculations and round your answers to the nearest whole number, e.g., 32.)
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PROBLEMS Problem 21-1 (ACP) 1 Aroma Company reported the following shareholders' equity: Ordinary share capital, 50,000 shares, P100 par Share premium Retained earnings 5,000,000 200,000 2,000,000 Subsequently, the following transactions, among others occurred: a. Treasury shares of 5,000 were acquired at P160 per share. b. Assuming the treasury shares were reissued for P1,000,000. c. Assuming the treasury shares were reissued for P700,000. Required: 1. Prepare journal entries to record the transactions. 2. Prepare journal entry to record the retirement of the treasury shares, assuming the treasury shares are not reissued. The original issue price of treasury shares was P104 per share. Problem 21-2 (ACP) the following issues of share capital: 200,000 shares at P20 250,000 shares at P25 4,000,000 6,250,000 per share. nsactions
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