In The Process Of the Acquisition, ABC Incorporation Paid In Cash the Following Expenses USAccounting fees 30,000Travel expenses 10,000Accounting fees (SEC) 10,000SEC filing fees 20,000Required: Prepare the journal entry to record the acquisition expenses

First, we need to identify the expenses that ABC Incorporation has incurred during the acquisition…

Answered: In The Process Of the Acquisition, ABC…

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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In 2018, PepsiCo, Inc. acquired SodaStream, a sparkling water maker, for $3,343 million in cash. At the acquisition date, SodaStream's identifiable net assets had fair values as follows (in millions): Inventories $176 Property, plant and equipment 193 Intangible assets 2,124 Other net assets (93) Required Prepare the journal entry necessary to record this acquisition on PepsiCo's books, assuming it is reported as a merger. Note: Provide all answers in millions. To record acquisition of SodaStream. くくくくくく Debit Credit
ABC Co. engaged your services to compute the goodwill and purchase price for the acquisition of XYZ Corp. The following data are available for XYZ Corp.: 6,000,000 Current Liabilities 2,500,000 Non-current liabilities Property, Plant and Equipment 13,000,000 Ordinary shares Share Premium 3,500,000 2,500,000 7,000,000 1,500,000 7,000,000 21,500,000 Total Liabilities and Equity 21,500,000 Current Asset Investments Accumulated Profits Total Assets You found out that the investments have a fair value of P2,000,000 and the current assets and property, plant and equipment are understated by P800,000 and P1,850,000 respectively. All other assets and equities are properly stated. An examination of the company's income for the last 4 years revealed that the total earnings amounted to P9,000,000. The said earnings include gain on sale during the last year of P100,000 and P150,000 annual bonus of the president. The normal rate of return is 10%. Compute for the goodwill (purchase of goodwill for 4…
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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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Acquisition Entries, Acquisition Costs, Bargain Gain Plastic Corporation is contemplating a business combination with Steel Corporation at December 31, 2021. Steel's condensed balance sheet on that date appears below: Assets Cash and receivables Inventory Equity method investments Land Buildings and equipment Patents Total assets Liabilities and Stockholders' Equity Liabilities Common stock Retained earnings Total liabilities and equity Cash and receivables Inventory Equity method investments Land Description Buildings and equipment Patents Goodwill Liabilities Required Prepare the journal entry to record the business combination of Plastic and Steel for each of the following acquisition costs and combination methods. (a) Plastic acquires Steel as a merger for $250,000 cash. Other direct cash acquisition costs are $20,000. General Journal Description Cash and receivables Inventory Equity method investments. Land Liabilities Cash Buildings and equipment Patents ÷ Description (b) Plastic…
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Effects of qualifying as a business on asset acquisitions Assume that on January 1, 2016 an investor company paid $8,700 to an investee company in exchange for the following assets and liabilities transferred from the investee company: Investee's Estimated Fair Asset (Liability) Production equipment Book Value Value $900 $780 4,500 300 4,290 1,170 1,560 Factory Land Patents In addition, the investor provided to the seller contingent consideration with a fair value of $200 and the investor paid an additional $300 of transaction costs to an unaffiliated third party. The contingent consideration has a potential settlement value of $450 in two years, and is not a derivative financial instrument. The book values are from the investee's financial records immediately before the exchange. The fair values are measured in accordance with FASB ASC 820: Fair Value Measurement. Parts a. and b. are independent of each other. If no additional debit or credit entries are required, select "No entry" as…

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In The Process Of the Acquisition, ABC Incorporation Paid In Cash the Following Expenses US Accounting fees 30,000 Travel expenses 10,000 Accounting fees (SEC) 10,000 SEC filing fees 20,000 Required: Prepare the journal entry to record the acquisition expenses