Fresh Cut Corporation purchased all the outstanding common stock of Premium Meats for $11,500,000fair values of Premium Meats' assets and liabilities were as follows:Accounts Receivable.EquipmentPatentsNotes PayableNet assetsRequired:1. Calculate the amount Fresh Cut should report for goodwill.2. Record Fresh Cut's acquisition of Premium Meats.Required 1 Required 2Complete this question by entering your answers in the tabs below.View transaction listRecord Fresh Cut's acquisition of Premium Meats. (If no entry is required for a transaction/event, select "Nthe first account field. Enter your answers in millions rounded to 2 decimal places (i.e., 5,550,000 shouldBook Value$ 1,550,0008,250,000250,000(2,200,000)$ 7,850,000Journal entry worksheet1Record the acquisition of Premium Meats.Note: Enter debits before credits.Transaction1Record entryFair Value$ 1,350,0009,650,0001,450,000(2,200,000)$ 10,250,000General JournalClear entry< Required 1< PrevDebitCreditView general journalRequired 2 >2 of 18 +Next > Problem 7-3A (Algo) Calculate and record goodwill (LO7-2)Fresh Cut Corporation purchased all the outstanding common stock of Premium Meats for $11,500,000 in cash. The book values andfair values of Premium Meats' assets and liabilities were as follows:Accounts ReceivableEquipment.Patents.Notes PayableNet assetsRequired:1. Calculate the amount Fresh Cut should report for goodwill.2. Record Fresh Cut's acquisition of Premium Meats.Required 1 Required 2Book Value$ 1,550,0008,250,000250,000(2,200,000)$ 7,850,000Complete this question by entering your answers in the tabs below.GoodwillFair Value$ 1,350,0009,650,0001,450,000(2,200,000)$ 10,250,000Calculate the amount Fresh Cut should report for goodwill. (Enter your answer in millions rounded to 2 decimal places (i.e.,$5,500,000 should be entered as 5.50).)million< Required 1Required 2 >

Goodwill is a amount paid by purchasing company in excess of net cost of assets acquired. If the…

Fresh Cut Corporation purchased all the outstanding common stock of Premium Meats for $11,500, fair values of Premium Meats' assets and liabilities were as follows: Accounts Receivable Equipment Patents Notes Payable Net assets Required: 1. Calculate the amount Fresh Cut should report for goodwill. 2. Record Fresh Cut's acquisition of Premium Meats. View transaction list Book Value $ 1,550,000 8,250,000 250,000 Complete this question by entering your answers in the tabs below. (2,200,000) $ 7,850,000 Required 1 Required 2 Record Fresh Cut's acquisition of Premium Meats. (If no entry is required for a transaction/event, select the first account field. Enter your answers in millions rounded to 2 decimal places (i.e., 5,550,000 shou 1 Journal entry worksheet Note: Enter debits before credits. Record the acquisition of Premium Meats. Transaction 1 Fair Value $ 1,350,000 9,650,000 1,450,000 (2,200,000) $ 10,250,000 General Journal Debit Credit

Fresh Cut Corporation purchased all the outstanding common stock of Premium Meats for $11,500, fair values of Premium Meats' assets and liabilities were as follows: Accounts Receivable Equipment Patents Notes Payable Net assets Required: 1. Calculate the amount Fresh Cut should report for goodwill. 2. Record Fresh Cut's acquisition of Premium Meats. View transaction list Book Value $ 1,550,000 8,250,000 250,000 Complete this question by entering your answers in the tabs below. (2,200,000) $ 7,850,000 Required 1 Required 2 Record Fresh Cut's acquisition of Premium Meats. (If no entry is required for a transaction/event, select the first account field. Enter your answers in millions rounded to 2 decimal places (i.e., 5,550,000 shou 1 Journal entry worksheet Note: Enter debits before credits. Record the acquisition of Premium Meats. Transaction 1 Fair Value $ 1,350,000 9,650,000 1,450,000 (2,200,000) $ 10,250,000 General Journal Debit Credit

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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Acquiring net assets that constitute a business Assume on January 1, 2022 an investor company paid $1,188 to an investee company in exchange for the following assets and liabilities transferred from the investee company: Asset (Liability) Estimated Fair Value Production equipment $420 480 Factory Licenses 300 In addition, the investor provided to the seller contingent consideration with a fair value of $120 and the investor paid an additional $48 of transaction costs to an unaffiliated third party. The contingent consideration is not a derivative financial instrument. The fair values are measured in accordance with FASB ASC 820: Fair Value Measurement. Assume the net assets transferred from the investee qualify as a "business," as that term is defined in FASB ASC Master Glossary. At what amount will Goodwill be reported in the financial statements of the acquiring company on January 1, 2022? Select one: a. $12 b. $108 c. $36 d. SO
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Mainline Produce Corporation acquired all the outstanding common stock of Iceberg Lettuce Corporation for $30,000,000 in cash. The book values and fair values of Iceberg's assets and liabilities were as follows: Current assets Property, plant, and equipment Other assets Current liabilities Long-term liabilities Required: 1. Calculate the amount paid for goodwill. 2. Determine the financial statement effects of the acquisition. Required 1 Required 2 Complete this question by entering your answers in the tabs below. Book Value $ 11,400,000 20,200,000 3,400,000 7,800,000 13,200,000 Assets Determine the financial statement effects of the acquisition. Note: Amounts to be deducted should be indicated with a minus sign. Enter your answer in millions rounded to 1 decimal place. (i.e. 5,500,000 should be entered as 5.5). Accounts Payable Accounts Receivable Accumulated Depreciation Advertising Expense Fair Value $ 14,400,000 26,200,000 4,400,000 7,800,000 12,200,000 Balance Sheet Liabilities…
Painted Desert has acquired several companies. Assume that Painted Desert purchased Oak Tree Unlimited for $14,000,000 cash. The book value of Oak Tree Unlimited's assets is $14,000,000 (fair value, $15,000,000), and it has liabilities of $13,000,000 (fair value, $13,000,000). Requirements 1. Compute the cost of goodwill purchased by Painted Desert. 2. Record the purchase of Oak Tree Unlimited by Painted Desert. Requirement 1. Compute the cost of goodwill purchased by Painted Desert. Purchase price to acquire Oak Tree Unlimited Fair value of Oak Tree Unlimited's assets Less: Fair value of Oak Tree Unlimited's liabilities Less: Fair value of Oak Tree Unlimited's net assets Goodwill Requirement 2. Record the purchase of Oak Tree Unlimited by Painted Desert. (Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Date Accounts and Explanation Debit Credit…
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Garcla Co. owns equlipment that cost $77,600, with accumulated depreclation of $41.200. Record the sale of the equipment under the following three separate cases assuming Garcla sells the equipment for (1) $47,600 cash. (2) $36,400 cash, and (3) $31.,300 cash. Vlew transaction Ilat Journal entry worksheet A Record the sale of equipment assuming Garcia sells the equipment for $47,600 cash. Note: Enter debits before credits. Transaction General Journal Debit Credit Record entry Clear entry Vlew general journal
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Dynamo Manufacturing paid cash to acquire the assets of an existing company. Among the assets acquired were the following items.Patent with 4 remaining years of legal life $32,200Goodwill 43,700Dynamo’s financial condition just prior to the acquisition of these assets is shown in the following statements model.Balance Sheet Income StatementAssets= Liabilities +Stockholders’Equity Revenue − Expenses = Net IncomeStatementof CashCash Flows + Patent + Goodwill92,000 + NA + NA = NA + 92,000 NA − NA = NA NARequireda. Compute the annual amortization expense for these items.b. Show the acquisition of the intangible assets and the related amortization expense for Year 1 in a horizontal statements model.c. Prepare the journal entries to record the acquisition of the intangible assets and the related amortization for year