Following are preacquisition financial balances for Padre Company and Sol Company as of December 31. Also included are fair values for Sol Company accounts. Cash Receivables Inventory Items Land Building and equipment (net) Franchise agreements Accounts payable Accrued expenses Long-term liabilities. Common stock-$20 par value Common stock-$5 par value Additional paid-in capital Retained earnings, 1/1 Revenues Expenses Padre Company Book Values 12/31 $509,000 234,750 412,500 725,000 685,000 274,000 (380,000) (145,000) (917,500) (660,000) 0 (70,000) (627,500) (968,250) 928,000 Note: Parentheses indicate a credit balance. Sol Company Book Values 12/31 $ 57,350 304,000 238,000 154,000 407,000 226,000 (195,000) (52,750) (555,000) 0 (210,000) (90,000) (255,000) (420,600) 392,000 Fair Values 12/31 $57,350 304,000 296,500 133,000 476,700 257,800 (195,000) (52,750) (555,000) 0 0 0 0 0 0 On December 31, Padre acquires Sol's outstanding stock by paying $412,000 in cash and issuing 10,200 shares of its own common stock with a fair value of $40 per share. Padre paid legal and accounting fees of $22,800 as well as $10,500 in stock issuance costs. Required: Determine the value that would be shown in Padre's consolidated financial statements for each of the accounts listed: Note: Input all amounts as positive values.
Following are preacquisition financial balances for Padre Company and Sol Company as of December 31. Also included are fair values for Sol Company accounts. Cash Receivables Inventory Items Land Building and equipment (net) Franchise agreements Accounts payable Accrued expenses Long-term liabilities. Common stock-$20 par value Common stock-$5 par value Additional paid-in capital Retained earnings, 1/1 Revenues Expenses Padre Company Book Values 12/31 $509,000 234,750 412,500 725,000 685,000 274,000 (380,000) (145,000) (917,500) (660,000) 0 (70,000) (627,500) (968,250) 928,000 Note: Parentheses indicate a credit balance. Sol Company Book Values 12/31 $ 57,350 304,000 238,000 154,000 407,000 226,000 (195,000) (52,750) (555,000) 0 (210,000) (90,000) (255,000) (420,600) 392,000 Fair Values 12/31 $57,350 304,000 296,500 133,000 476,700 257,800 (195,000) (52,750) (555,000) 0 0 0 0 0 0 On December 31, Padre acquires Sol's outstanding stock by paying $412,000 in cash and issuing 10,200 shares of its own common stock with a fair value of $40 per share. Padre paid legal and accounting fees of $22,800 as well as $10,500 in stock issuance costs. Required: Determine the value that would be shown in Padre's consolidated financial statements for each of the accounts listed: Note: Input all amounts as positive values.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:Following are preacquisition financial balances for Padre Company and Sol Company as of December 31. Also included are fair values
for Sol Company accounts.
Cash
Receivables
Inventory
Items
Land
Building and equipment (net)
Franchise agreements
Accounts payable
Accrued expenses
Long-term liabilities
Common stock-$20 par value
Common stock-$5 par value
Additional paid-in capital
Retained earnings, 1/1
Revenues
Expenses
Note: Parentheses indicate a credit balance.
Padre Company
Book Values
12/31
$ 509,000
234,750
412,500
725,000
685,000
274,000
(380,000)
(145,000)
(917,500)
(660,000)
Accounts
X Answer is not complete.
Inventory
Land
Buildings and equipment
Franchise agreements
Goodwill
(70,000)
(627,500)
(968,250)
928,000
Revenues
Additional paid-in capital
Expenses
Retained earnings, 1/1
Retained earnings, 12/31
$
On December 31, Padre acquires Sol's outstanding stock by paying $412,000 in cash and issuing 10,200 shares of its own common
stock with a fair value of $40 per share. Padre paid legal and accounting fees of $22,800 as well as $10,500 in stock issuance costs.
Amounts
$
709,000
$
858,000
$ 1,161,700
$
531,800
0
Required:
Determine the value that would be shown in Padre's consolidated financial statements for each of the accounts listed:
Note: Input all amounts as positive values.
968,250
Sol Company
$ 627,500
$ 644,950
Book Values
12/31
$57,350
304,000
238,000
154,000
407,000
226,000
(195,000)
(52,750)
(555,000)
0
(210,000)
(90,000)
(255,000)
(420,600)
392,000
Fair Values
12/31
$ 57,350
304,000
296,500
133,000
476,700
257,800
(195,000)
(52,750)
(555,000)
0
0
0
0
0
0
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