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 Padre Company Book Values 12/31 $ 193,250 Sol Company Book Values 12/31 $ 72,900 Fair Values 12/31 $ 72,900 Items Receivables 228,000 369,000 369,000 Inventory 602,500 190,000 242,200 Land 765,000 195,000 166,200 Building and equipment (net) 765,000 271,000 340,000 Franchise agreements 224,000 216,000 249,900 Accounts payable (350,000) (138,000) (138,000) Accrued expenses (119,000) (47,500) (47,500) Long-term liabilities Common stock-$5 par value Additional paid-in capital Retained earnings, 1/1 Revenues (995,000) (552,500) (552,500) Common stock-$20 par value (660,000) 0 0 0 (210,000) (70,000) (90,000) 0 0 Expenses (522,500) (1,041,250) 980,000 (251,000) 0 (352,900) 0 328,000 0 Note: Parentheses indicate a credit balance. On December 31, Padre acquires Sol's outstanding stock by paying $108,000 in cash and issuing 17,000 shares of its own common stock with a fair value of $40 per share. Padre paid legal and accounting fees of $24,300 as well as $10,300 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. Accounts Inventory Land Buildings and equipment Franchise agreements Goodwill Revenues Additional paid-in capital Expenses Retained earnings, 1/1 Retained earnings, 12/31 Amounts
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 Padre Company Book Values 12/31 $ 193,250 Sol Company Book Values 12/31 $ 72,900 Fair Values 12/31 $ 72,900 Items Receivables 228,000 369,000 369,000 Inventory 602,500 190,000 242,200 Land 765,000 195,000 166,200 Building and equipment (net) 765,000 271,000 340,000 Franchise agreements 224,000 216,000 249,900 Accounts payable (350,000) (138,000) (138,000) Accrued expenses (119,000) (47,500) (47,500) Long-term liabilities Common stock-$5 par value Additional paid-in capital Retained earnings, 1/1 Revenues (995,000) (552,500) (552,500) Common stock-$20 par value (660,000) 0 0 0 (210,000) (70,000) (90,000) 0 0 Expenses (522,500) (1,041,250) 980,000 (251,000) 0 (352,900) 0 328,000 0 Note: Parentheses indicate a credit balance. On December 31, Padre acquires Sol's outstanding stock by paying $108,000 in cash and issuing 17,000 shares of its own common stock with a fair value of $40 per share. Padre paid legal and accounting fees of $24,300 as well as $10,300 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. Accounts Inventory Land Buildings and equipment Franchise agreements Goodwill Revenues Additional paid-in capital Expenses Retained earnings, 1/1 Retained earnings, 12/31 Amounts
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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
Padre Company
Book Values
12/31
$ 193,250
Sol Company
Book Values
12/31
$ 72,900
Fair Values
12/31
$ 72,900
Items
Receivables
228,000
369,000
369,000
Inventory
602,500
190,000
242,200
Land
765,000
195,000
166,200
Building and equipment (net)
765,000
271,000
340,000
Franchise agreements
224,000
216,000
249,900
Accounts payable
(350,000)
(138,000)
(138,000)
Accrued expenses
(119,000)
(47,500)
(47,500)
Long-term liabilities
Common stock-$5 par value
Additional paid-in capital
Retained earnings, 1/1
Revenues
(995,000)
(552,500)
(552,500)
Common stock-$20 par value
(660,000)
0
0
0
(210,000)
(70,000)
(90,000)
0
0
Expenses
(522,500)
(1,041,250)
980,000
(251,000)
0
(352,900)
0
328,000
0
Note: Parentheses indicate a credit balance.
On December 31, Padre acquires Sol's outstanding stock by paying $108,000 in cash and issuing 17,000 shares of its own common
stock with a fair value of $40 per share. Padre paid legal and accounting fees of $24,300 as well as $10,300 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.
Accounts
Inventory
Land
Buildings and equipment
Franchise agreements
Goodwill
Revenues
Additional paid-in capital
Expenses
Retained earnings, 1/1
Retained earnings, 12/31
Amounts
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