On December 31, 20X1, Parent Company purchased 80% of the common stock of Subsidiary Company for $280,000. On this date, Subsidiary had total owners' equity of $250,000 (common stock $20,000; other paid-in capital, $80,000; and retained earnings, $150,000). Any excess of cost over
On December 31, 20X1, Parent Company purchased 80% of the common stock of Subsidiary Company for $280,000. On this date, Subsidiary had total owners' equity of $250,000 (common stock $20,000; other paid-in capital, $80,000; and
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Prepare the determination and distribution schedule for this business combination |
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Check Number – Excess of FV over BV $100,000 |
Determination and distribution of excess schedule (D & D) Compares the price paid with the subsidiary equity to predetermine the imbalance that will occur on the consolidated worksheet when the investment account amount is eliminated against the underlying subsidiary equity.
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