On 1/1/2020, ABC Corporation balance sheet included the following accounts: Patents $100,000, Bonds Payable $40,000, Common Stock $10,000, Retained Earnings $50,000. Book values of assets and liabilities were equal to their fair values. XYZ Corporation acquired 100% of the common stock of ABC Corporation on 1/1/2020 for $120.000 Cash. Which of the following entries was prepared to record the acquisition on XYZ's books? Patents Bonds Payable Cash Investment in Subsidiary Goodwill Gain on Acquisition of Business Debit $100,000 Credit $40,000 Credit $120.000 Debit $60.000

On 1/1/2020, ABC Corporation balance sheet included the following accounts: Patents $100,000, Bonds Payable $40,000, Common Stock $10,000, Retained Earnings $50,000. Book values of assets and liabilities were equal to their fair values. XYZ Corporation acquired 100% of the common stock of ABC Corporation on 1/1/2020 for $120.000 Cash. Which of the following entries was prepared to record the acquisition on XYZ's books? Patents Bonds Payable Cash Investment in Subsidiary Goodwill Gain on Acquisition of Business Debit $100,000 Credit $40,000 Credit $120.000 Debit $60.000

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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Concept explainers

Consolidation

Consolidation in general examination implies an asset oscillating between well-defined methods of trading status. Consolidation is commonly known as market indecisiveness, which completes when the asset's values move forward or backward the trading structure.

Question

On 1/1/2020, ABC Corporation balance sheet included the following accounts: Patents $100,000, Bonds Payable $40,000.
Common Stock $10,000, Retained Earnings $50,000. Book values of assets and liabilities were equal to their fair values. XYZ
Corporation acquired 100% of the common stock of ABC Corporation on 1/1/2020 for $120.000 Cash. Which of the following
entries was prepared to record the acquisition on XYZ's books?
Patents
Bonds Payable
Cash
Investment in Subsidiary
Goodwill
Gain on Acquisition of Business
Debit $100,000
Credit $40,000
Credit $120,000
Debit $60.000

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H1.