Mainline Produce Corporation acquired all the outstanding common stock of Iceberg Lettuce Corporation for $41,000,000 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: Book Value $ 11,000,000 26,400,000 2,600,000 7,000,000 12,000,000 Fair Value $ 14,000,000 32,400,000 3,600,000 7,000,000 11,000,000 Calculate the amount paid for goodwill. (Enter your answer in millions (i.e. 5,000,000 should be entered as 5).) Amount paid for goodwill million

Mainline Produce Corporation acquired all the outstanding common stock of Iceberg Lettuce Corporation for $41,000,000 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: Book Value $ 11,000,000 26,400,000 2,600,000 7,000,000 12,000,000 Fair Value $ 14,000,000 32,400,000 3,600,000 7,000,000 11,000,000 Calculate the amount paid for goodwill. (Enter your answer in millions (i.e. 5,000,000 should be entered as 5).) Amount paid for goodwill million

Auditing: A Risk Based-Approach (MindTap Course List)

11th Edition

ISBN:9781337619455

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter12: Auditing Long-lived Assets And Merger And Acquisition Activity

Section: Chapter Questions

Problem 37RQSC

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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 Current liabilities Book Value $ 10,200,000 21,000,000 1,800,000 7,200,000 11,800,000 Fair Value $ 13,200,000 Other assets Long-term liabilities Required: 27,000,000 2,800,000 7,200,000 10,800,000 Calculate the amount paid for goodwill. (Enter your answer in millions (i.e. 5,000,000 should be entered as 5).) Amount paid for goodwill million
Mainline Produce Corporation acquired all the outstanding common stock of Iceberg Lettuce Corporation for $33,000,000 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: Book Value $ 12,800,000 26,800,000 Fair Value $ 15,800,000 32,800,000 4,400,000 5,400,000 8,800,000 16,200,000 8,800,000 15,200,000 Calculate the amount paid for goodwill. (Enter your answer in millions (i.e. 5,000,000 should be entered as 5).) Amount paid for goodwill million
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: Book Value Fair ValueCurrent assets $11,400,000 $ 14,400,000Property, plant, and equipment 20,200,000 26,200,000Other assets 3,400,000 4,400,000Current liabilities 7,800,000 7,800,000Long-term liabilities 13,200,000 12,200,000Required:Calculate the amount paid for goodwill.
New Harvest Bakery acquired all the outstanding common stock of Red Rock Bakery for $72,800 in cash. The book values and fair values of Red Rock's assets and liabilities were as follows: Book Value Fair Value Current assets Property, plant, and equipment Other assets Current liabilities Long-term liabilities $25,100 43,900 4,900 18,000 25,600 $23,900 50,400 5,700 14,600 20,500 Calculate the amount paid for goodwill. Goodwill
Mainline Produce Corporation acquired all the outstanding common stock of Iceberg Lettuce Corporation for $32,000,000 in cash. The book values and fair values of Iceberg's assets and liabilities were as follows: Book Value Fair Value $ 12,000,000 $ 15,000,000 21,400,000 3,600,000 8,000,000 14,000,000 Current assets Property, plant, and equipment Other assets 27,400,000 4,600,000 8,000,000 13,000,000 Current liabilities Long-term liabilities Required: Calculate the amount paid for goodwill. (Enter your answer in millions (i.e. 5,000,000 should be entered as 5).) Amount paid for goodwill million
Planter Corporation used debentures with a par value of $644,000 to acquire 100 percent of Sorden Company's net assets on January 1, 20X2. On that date, the fair value of the bonds issued by Planter was $627,000. The following balance sheet data were reported by Sorden: Balance Sheet Item Assets Cash and Receivables Inventory Land Plant and Equipment Less: Accumulated Depreciation Goodwill Total Assets Liabilities and Equities Accounts Payable Common Stock Additional Paid-In Capital Retained Earnings Total Liabilities and Equities Historical Cost $ 56,000 114,000 64,000 414,000 (154,000) 12,000 $ 506,000 $ 49,000 84,000 57,000 316,000 $ 506,000 Fair Value $ 48,000 182,000 92,000 290,000 $ 612,000 $ 49,000 Required: Prepare the journal entry that Planter recorded at the time of exchange. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
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Northern Equipment Corporation purchased all the outstanding common stock of Pioneer Equipment Rental for $5,600,000 in cash. The book values and fair values of Pioneer’s assets and liabilities were Book Value Fair ValueAccounts Receivable $ 750,000 $ 650,000Buildings 4,100,000 4,800,000Equipment 110,000 200,000Accounts Payable (750,000) (750,000)Net assets $ 4,210,000 $ 4,900,000Required:1. Calculate the amount Northern Equipment should report for goodwill.2. Record Northern Equipment’s acquisition of Pioneer Equipment Rental.
During the current year, Brewer Company acquired all of the outstanding common stock of Miller Inc. paying $11,900,000 cash. The book values and fair values of Miller's assets and liabilities acquired are listed below: Book Value Fair Value Accounts receivable $ 1,750,000 $ 1,575,000 Inventories 2,600,000 3,900,000 Property, plant, and equipment 8,900,000 11,525,000 Accounts payable 2,900,000 2,900,000 Bonds payable 4,400,000 4,025,000 Prepare the journal entry to record the acquisition by Brewer Company.
Johnson Corporation acquired all of the outstanding common stock of Smith Corporation for $11,000,000 in cash. The book value of Smith’s net assets (assets minus liabilities) was $7,800,000. The fair values of all of Smith’s assets and liabilities were equal to their book values with the following exceptions: Book Value Fair ValueReceivables $ 1,300,000 $1,100,000Property, plant, and equipment 8,000,000 9,400,000Intangible assets 200,000 1,200,000 Required:Calculate the amount paid for goodwill.
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On May 1, Burns Corporation acquired 100 percent of the outstanding ownership shares of Quigley Corporation in exchange for $733,000 cash. At the acquisition date, Quigley's book and fair values were as follows: Cash Receivables Inventory Land Building and equipment (net) Patented technology Total assets Accounts payable Long-term liabilities Common stock ($5 par value) Additional paid-in capital Retained earnings Total liabilities and stockholders equity Total assets Book Value Fair Value $ 101,000 $ 101,000 229,000 229,000 254,000 323,000 157,500 118,500 330,000 409,000 0 220,000 Assets $1,071,500 $ 1,400,500 $ 146,000 $ 666,000 210,000 90,000 (40,500) $1,071,500 Burns directs Quigley to seek additional financing for expansion through a new long-term debt issue. Consequently, Quigley will issue a set of financial statements separate from that of its new parent to support its request for debt and accompanying regulatory filings. Quigley elects to apply pushdown accounting in order to…