March 1, 2015, Collier Enterprises purchases a 100% interest in Robby Corporation for $480,000 cash. Robby Corporation applies push-down accounting principles Problem 2-5 (LO 5, 6, 9) 100% purchase, goodwill, push- to account for this acquisition. Robby Corporation has the following balance sheet on February 28, 2015: vollo sdr Robby Corporation Balance Sheet February 28, 2015 Liabilities and Equity Assets $ 60,000 Current liabilities.. 80,000 Bonds payable 40,000 Common stock ($5). 300,000 Paid-in capital in excess of par (120,000) Retained earnings 220,000 $ 50,000 100,000 50,000 250,000 70,000 Accounts receivable Inventory Land.. Buildings Accumulated depreciation-buildings Equipment Accumulated depreciation-equipment. (60,000) $ 520,000 Total assets.. Total liabilities and equity $520,000 ... Collier Enterprises receives an independent appraisal on the fair values of Robby Corpora- tion's assets and liabilities. The controller has reviewed the following figures and accepts them as reasonable: Accounts receivable $ 60,000 100,000 Inventory Land.. Buildings Equipment . Current liabilities 55,000 200,000 150,000 50,000 98,000 Bonds payable 1. Record the investment in Robby Corporation. 2. Prepare the value analysis schedule and the determination and distribution of excess schedule. 3. Give Robby Corporation's adjusting entry.
March 1, 2015, Collier Enterprises purchases a 100% interest in Robby Corporation for $480,000 cash. Robby Corporation applies push-down accounting principles Problem 2-5 (LO 5, 6, 9) 100% purchase, goodwill, push- to account for this acquisition. Robby Corporation has the following balance sheet on February 28, 2015: vollo sdr Robby Corporation Balance Sheet February 28, 2015 Liabilities and Equity Assets $ 60,000 Current liabilities.. 80,000 Bonds payable 40,000 Common stock ($5). 300,000 Paid-in capital in excess of par (120,000) Retained earnings 220,000 $ 50,000 100,000 50,000 250,000 70,000 Accounts receivable Inventory Land.. Buildings Accumulated depreciation-buildings Equipment Accumulated depreciation-equipment. (60,000) $ 520,000 Total assets.. Total liabilities and equity $520,000 ... Collier Enterprises receives an independent appraisal on the fair values of Robby Corpora- tion's assets and liabilities. The controller has reviewed the following figures and accepts them as reasonable: Accounts receivable $ 60,000 100,000 Inventory Land.. Buildings Equipment . Current liabilities 55,000 200,000 150,000 50,000 98,000 Bonds payable 1. Record the investment in Robby Corporation. 2. Prepare the value analysis schedule and the determination and distribution of excess schedule. 3. Give Robby Corporation's adjusting entry.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Transcribed Image Text:Problem 2-5 (LO 5, 6, 9) 100% purchase, goodwill, push-down accounting. On
March 1, 2015, Collier Enterprises purchases a 100% interest in Robby Corporation for
$480,000 cash. Robby Corporation applies push-down accounting principles to account for
on the date of acquisiti
this acquisition.
bas
Robby Corporation has the following balance sheet on February 28, 2015:
Robby Corporation
Balance Sheet
February 28, 2015
Liabilities and Equity
Assets
. $ 60,000 Current liabilities ....
80,000 Bonds payable
40,000 Common stock ($5). .
300,000 Paid-in capital in excess of par
(120,000) Retained earnings .
220,000
$ 50,000
100,000
50,000
250,000
70,000
Accounts receivable
..
Inventory
Land.....
..
Buildings..
Accumulated depreciation-buildings ..
Equipment ....
Accumulated depreciation-equipment .
..
(60,000)
Total assets..
$ 520,000
Total liabilities and equity ..... $520,000
Collier Enterprises receives an independent appraisal on the fair values of Robby Corpora-
tion's assets and liabilities. The controller has reviewed the following figures and accepts them as
reasonable:
Accounts receivable ..
$ 60,000
100,000
Inventory.
Land....
Buildings ....
Equipment ....
Current liabilities ...
Bonds payable ....
55,000
200,000
150,000
50,000
98,000
Reds
06 2
1. Record the investment in Robby Corporation.
2. Prepare the value analysis schedule and the determination and distribution of excess
schedule.
3. Give Robby Corporation's adjusting entry. 06
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Price paid cash , Number of shares, Market Price per share be?
Would it be?
Cash: $480,000 Number of shares 10,000 Market price per share $5.00 Total of $530,000?
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