On January 1, 2023, Tamarisk Company issued 1,450 of its $20 par value common shares with a fair value of $60 per share in exchange for the 2,000 outstanding common shares of Sheffield Company in a purchase transaction. Registration costs amounted to $2,500, paid in cash. Just prior to the acquisition, the balance sheets of the two companies were as follows: Cash Accounts receivable (net) Inventory Plant and equipment (net) Land Total assets Accounts payable Notes payable Common stock, $20 par value Other contributed capital Retained earnings Total equities Tamarisk Company Sheffield Company $83,000 $12,600 103,000 18,000 56,000 95,000 23,500 $360,500 $63,000 89,500 100,000 60,000 48,000 $360,500 25,000 46,500 22,000 $124,100 $19,500 30,000 40,000 27,500 7,100 $124,100 Any difference between the book value of equity and the value implied by the purchase price relates to goodwill.

On January 1, 2023, Tamarisk Company issued 1,450 of its $20 par value common shares with a fair value of $60 per share in exchange for the 2,000 outstanding common shares of Sheffield Company in a purchase transaction. Registration costs amounted to $2,500, paid in cash. Just prior to the acquisition, the balance sheets of the two companies were as follows: Cash Accounts receivable (net) Inventory Plant and equipment (net) Land Total assets Accounts payable Notes payable Common stock, $20 par value Other contributed capital Retained earnings Total equities Tamarisk Company Sheffield Company $83,000 $12,600 103,000 18,000 56,000 95,000 23,500 $360,500 $63,000 89,500 100,000 60,000 48,000 $360,500 25,000 46,500 22,000 $124,100 $19,500 30,000 40,000 27,500 7,100 $124,100 Any difference between the book value of equity and the value implied by the purchase price relates to goodwill.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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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

Prepare a consolidated balance sheet at the date of acquisition. (List assets in order of liquidity.)
TAMARISK COMPANY AND SUBSIDIARY
Consolidated Balance Sheet
January 2, 2023
Assets
659
$
Liabilities and Stockholders' Equity
$
LLO

On January 1, 2023, Tamarisk Company issued 1,450 of its $20 par value common shares with a fair value of $60 per share in
exchange for the 2,000 outstanding common shares of Sheffield Company in a purchase transaction. Registration costs amounted to
$2,500, paid in cash. Just prior to the acquisition, the balance sheets of the two companies were as follows:
Cash
Accounts receivable (net)
Inventory
Plant and equipment (net)
Land
Total assets
Accounts payable
Notes payable
Common stock, $20 par value
Other contributed capital
Retained earnings
Total equities
Tamarisk Company
$83,000
103,000
56,000
95,000
23,500
$360,500
$63,000
89,500
100,000
60,000
48,000
$360,500
Sheffield Company
$12,600
18,000
25,000
46,500
22,000
$124,100
$19,500
30,000
40,000
27,500
7,100
$124,100
Any difference between the book value of equity and the value implied by the purchase price relates to goodwill.

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