On December 31, 2020, Petra Company invests $33,000 in Valery, a variable interest entity. In contractual agreements completed on that date, Petra established itself as the primary beneficiary of Valery. Previously, Petra had no equity interest in Valery. Immediately after Petra's investment, Valery presents the following balance sheet: Cash Marketing software Computer equipment Total assets Each of the amounts represents an assessed fair value at December 31, 2020, except for the marketing software. The December 31 business fair value of Valery is assessed at $132,000. $ 33,000 153,000 53,000 $ 239,000 a. If the carrying amount of the marketing software was undervalued by $38,000, what amounts for Valery would appear in Petra's December 31, 2020, consolidated financial statements? Required A b. If the carrying amount of the marketing software was overvalued by $38,000, what amounts for Valery would appear in Petra's December 31, 2020, consolidated financial statements? Complete this question by entering your answers in the tabs below. Required B Long-term debt Noncontrolling interest Petra equity interest Total liabilities and equity Account $ 107,000 99,000 33,000 $ 239,000 Cash Marketing software Computer equipment Long-term debt Noncontrolling interest If the carrying amount of the marketing software was undervalued by $38,000, what amounts for Valery would appear in Petra's December 31, 2020, consolidated financial statements? (Input all amounts as positive values.) Amount
On December 31, 2020, Petra Company invests $33,000 in Valery, a variable interest entity. In contractual agreements completed on that date, Petra established itself as the primary beneficiary of Valery. Previously, Petra had no equity interest in Valery. Immediately after Petra's investment, Valery presents the following balance sheet: Cash Marketing software Computer equipment Total assets Each of the amounts represents an assessed fair value at December 31, 2020, except for the marketing software. The December 31 business fair value of Valery is assessed at $132,000. $ 33,000 153,000 53,000 $ 239,000 a. If the carrying amount of the marketing software was undervalued by $38,000, what amounts for Valery would appear in Petra's December 31, 2020, consolidated financial statements? Required A b. If the carrying amount of the marketing software was overvalued by $38,000, what amounts for Valery would appear in Petra's December 31, 2020, consolidated financial statements? Complete this question by entering your answers in the tabs below. Required B Long-term debt Noncontrolling interest Petra equity interest Total liabilities and equity Account $ 107,000 99,000 33,000 $ 239,000 Cash Marketing software Computer equipment Long-term debt Noncontrolling interest If the carrying amount of the marketing software was undervalued by $38,000, what amounts for Valery would appear in Petra's December 31, 2020, consolidated financial statements? (Input all amounts as positive values.) Amount
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Owe
Transcribed Image Text:On December 31, 2020, Petra Company invests $33,000 in Valery, a variable interest entity. In contractual agreements completed on
that date, Petra established itself as the primary beneficiary of Valery. Previously, Petra had no equity interest in Valery. Immediately
after Petra's investment, Valery presents the following balance sheet:
Cash
Marketing software
Computer equipment
Total assets
Each of the amounts represents an assessed fair value at December 31, 2020, except for the marketing software.
The December 31 business fair value of Valery is assessed at $132,000.
$ 33,000
153,000
53,000
$ 239,000
a. If the carrying amount of the marketing software was undervalued by $38,000, what amounts for Valery would appear in Petra's
December 31, 2020, consolidated financial statements?
Required A
b. If the carrying amount of the marketing software was overvalued by $38,000, what amounts for Valery would appear in Petra's
December 31, 2020, consolidated financial statements?
Complete this question by entering your answers in the tabs below.
Required B
Long-term debt
Noncontrolling interest
Petra equity interest
Total liabilities and equity
Account
Cash
Marketing software
Computer equipment
Long-term debt
Noncontrolling interest
If the carrying amount of the marketing software was undervalued by $38,000, what amounts for Valery would appear in
Petra's December 31, 2020, consolidated financial statements? (Input all amounts as positive values.)
$ 107,000
99,000
33,000
$ 239,000
Amount
Required A
Required B >
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 4 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education