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 Items Padre Company Book Values 12/31 $ 158,000 Sol Company Book Values 12/31 $ 70,500 Fair Values 12/31 $ 70,500 305,000 323,100 274,500 305,000 Inventory 582,500 267,000 Land 710,000 221,000 192,500 Building and equipment (net) 665,000 299,000 363,300 Franchise agreements 277,000 256,000 287,300 Accounts payable (339,000) (156,000) (156,000) Accrued expenses (148,000) (42,500) (42,500) Long-term liabilities (940,000) (607,500) (607,500) Common stock-$20 par value (660,000) 0 0 Common stock-$5 par value Additional paid-in capital Retained earnings, 1/1 Revenues 0 (210,000) 0 (70,000) (90,000) 0 Expenses (450,000) (1,038,000) 978,000 (290,000) 0 (343,500) 0 321,000 0 Note: Parentheses indicate a credit balance. On December 31, Padre acquires Sol's outstanding stock by paying $154,000 in cash and issuing 16,700 shares of its own common stock with a fair value of $40 per share. Padre paid legal and accounting fees of $26,300 as well as $10,600 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. Answer is not complete. Accounts Amounts Inventory $ 905,600 Land $ 902,500 Buildings and equipment $ 1,028,300 Franchise agreements $ 533,000 Goodwill Revenues $ 1,038,000 Additional paid-in capital $ 657,400 x Expenses $ 1,004,300 Retained earnings, 1/1 $ 450,000 Retained earnings, 12/31 $ 1,038,000
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 Items Padre Company Book Values 12/31 $ 158,000 Sol Company Book Values 12/31 $ 70,500 Fair Values 12/31 $ 70,500 305,000 323,100 274,500 305,000 Inventory 582,500 267,000 Land 710,000 221,000 192,500 Building and equipment (net) 665,000 299,000 363,300 Franchise agreements 277,000 256,000 287,300 Accounts payable (339,000) (156,000) (156,000) Accrued expenses (148,000) (42,500) (42,500) Long-term liabilities (940,000) (607,500) (607,500) Common stock-$20 par value (660,000) 0 0 Common stock-$5 par value Additional paid-in capital Retained earnings, 1/1 Revenues 0 (210,000) 0 (70,000) (90,000) 0 Expenses (450,000) (1,038,000) 978,000 (290,000) 0 (343,500) 0 321,000 0 Note: Parentheses indicate a credit balance. On December 31, Padre acquires Sol's outstanding stock by paying $154,000 in cash and issuing 16,700 shares of its own common stock with a fair value of $40 per share. Padre paid legal and accounting fees of $26,300 as well as $10,600 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. Answer is not complete. Accounts Amounts Inventory $ 905,600 Land $ 902,500 Buildings and equipment $ 1,028,300 Franchise agreements $ 533,000 Goodwill Revenues $ 1,038,000 Additional paid-in capital $ 657,400 x Expenses $ 1,004,300 Retained earnings, 1/1 $ 450,000 Retained earnings, 12/31 $ 1,038,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Domestic
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
Items
Padre Company
Book Values
12/31
$ 158,000
Sol Company
Book Values
12/31
$ 70,500
Fair Values
12/31
$ 70,500
305,000
323,100
274,500
305,000
Inventory
582,500
267,000
Land
710,000
221,000
192,500
Building and equipment (net)
665,000
299,000
363,300
Franchise agreements
277,000
256,000
287,300
Accounts payable
(339,000)
(156,000)
(156,000)
Accrued expenses
(148,000)
(42,500)
(42,500)
Long-term liabilities
(940,000)
(607,500)
(607,500)
Common stock-$20 par value
(660,000)
0
0
Common stock-$5 par value
Additional paid-in capital
Retained earnings, 1/1
Revenues
0
(210,000)
0
(70,000)
(90,000)
0
Expenses
(450,000)
(1,038,000)
978,000
(290,000)
0
(343,500)
0
321,000
0
Note: Parentheses indicate a credit balance.
On December 31, Padre acquires Sol's outstanding stock by paying $154,000 in cash and issuing 16,700 shares of its own common
stock with a fair value of $40 per share. Padre paid legal and accounting fees of $26,300 as well as $10,600 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.
Answer is not complete.
Accounts
Amounts
Inventory
$
905,600
Land
$
902,500
Buildings and equipment
$
1,028,300
Franchise agreements
$
533,000
Goodwill
Revenues
$
1,038,000
Additional paid-in capital
$
657,400 x
Expenses
$ 1,004,300
Retained earnings, 1/1
$
450,000
Retained earnings, 12/31
$ 1,038,000
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