On January 1, Year 1, Pungent Corporation acquired 75% of Summer Corporation's 200,000 outstanding common shares for $2,850,000. On January 1, the book value of Summer's net assets was $3,000,000. Book value equaled fair value for all of Summer's assets and liabilities except land, which had a fair value of $200,000 greater than book value, and equipment, which had a fair value of $150,000 greater than book value. On January 1, Year 1, Summer had a non- compete agreement with a fair value of $300,000. Compute the amount of goodwill to be reported on Pungent Corporation's December 31, Year 1 balance sheet under U.S. GAAP.
Q: . Further information on the activities of the Juice industry in 2023 is providedin table 2.1 below…
A: Hope this helps.
Q: Garden Company has the capacity to produce 200,000 tillers. Variable costs are $30 per tiller. Fixed…
A: Detailed explanation: 1. Problem Breakdown and Variables DefinedThe Garden Company has three…
Q: 9 Which purpose of cost allocation is used to encourage sales representatives to push high-margin…
A: The question is asking for the purpose of cost allocation that is used to motivate sales…
Q: Financial accounting
A: Explanation of Purchase Commitment: A purchase commitment is a legally binding agreement that…
Q: Accurate answer
A: Step 1:Cost of capital asset includes a purchase price, and directly attributable costs that are…
Q: Prepare the Statement of Financial Position as at 29 February 2024. Additional information and…
A: First, we need to adjust the trial balance with the additional information and adjustments provided.…
Q: Please give me answer
A: Step 1:Formula of units required for target profit= (Fixed cost+ target profit)/ Contribution per…
Q: ? Answer share
A: Step 1:Key Features of Fair Value Accounting:Market-Based Measurement: It relies on observable…
Q: Provide answer this accounting question
A: Step 1: Define Cash Conversion CycleThe cash conversion cycle looks at the duration of inventory…
Q: expert help
A: Sales ($9 × 8)$72Less: Cost of widgets purchased(40)Less: Enhancements to widgets ($1 × 8)(8)Gross…
Q: A stock dividend___?
A: Stock dividends are recorded as a reduction of retained earnings and, at the same time, an increase…
Q: Production, direct materials, and direct labor budgets Gerrad Manufacturing has projected sales of…
A: Approach to solving the question: For better clarity of the solution, I have attached the Excel…
Q: Bangura Company provides this information for the month ended October 31, 2012: sales on credit…
A: Detailed SolutionTo prepare the sales revenues section of the income statement, we will calculate…
Q: Give true answer this accounting question
A: Step 1: Define Variance AnalysisThe budgeted production is dynamic for small-ticket items with high…
Q: Entry
A: Explanation of Standard Costing System: A standard costing system is a cost accounting method that…
Q: Compute the amount
A: Explanation of Raw Materials: Raw materials are the basic inputs purchased by a company that will be…
Q: Cost Accounting
A: Step 1:Variable costing includes only the variable costs directly associated with production, such…
Q: Answer me
A: To determine the break-even point for Cool Electronics, we analyzed the given information: each TV…
Q: account answer need
A: The question asks about the underlying conditions that create demand for reliable information. Each…
Q: The charges to Work in Process-Assembly Department for a period, together with information…
A: Cost of Beginning Work in Process Inventory Completed this PeriodThe beginning work in process (WIP)…
Q: Richardson Ski Racing (RSR) sells equipment needed for downhill ski racing. One of RSR's products is…
A: Detailed explanation: Part (a): Determining Total Revenue Using the VLOOKUP ConceptUnderstanding the…
Q: Presented below is information related to Rembrandt Inc.'s inventory. Please provide correct answer…
A: Step 1: Define Lower of Cost or MarketLower of cost or market is an inventory valuation method that…
Q: Concord Construction Company changed from the cost-recovery to the percentage-of-completion method…
A: To adjust for the change in accounting principle from the cost-recovery method to the…
Q: Jordon Company produced and sold 50,000 units in 2014. The units sold for $140 each. During the…
A: Step 1:Step 1: Define the formula for Gross MarginGross Margin per Unit = Selling Price per Unit -…
Q: ABC LLC manufactures and sells paper envelopes. The stock of envelopes was included in the closing…
A: Step 1: Define InventoryInvestors can study the inventory valuation method of a firm by reading the…
Q: Pam acquired its 80 percent-owned controlling interest in Sam on January 2021. The intercompany…
A: Requirement 1: Compute Pam's Net Income and Controlling Share of Consolidated Net Income…
Q: Provide correct answer for this accounting question
A: Step 1: Define ROEReturn on equity is used to estimate the firm's profit performance and investors…
Q: [The following information applies to the questions displayed below] Iguana, Incorporated,…
A: Question 1Given Sales and Collection InformationSales Price per Unit: $25.Sales Collection Split:80%…
Q: Q3-Prepare the Statement of Comprehensive Income of Omega Limited for the year ended 29 February…
A: Here are the explanations and calculations that led to the preparation of the Statement of…
Q: Regarding risk levels, financial managers should: A. evaluate investor's desire for risk. B. avoid…
A: A. Evaluate investor's desire for risk (Correct)To make sure the initiatives chosen suit investors'…
Q: I need correct answer
A: Step 1:Activity-Based Costing (ABC) systems assign overhead expenses to products or services based…
Q: Which of the following statements regarding restricted stock is false? Multiple Choice Even if the…
A: Even if the value of restricted stock decreases from the price on the grant date, it retains some…
Q: Answer
A: Step 1:Given details:Principal (Loan amount): $50,000Annual Interest Rate: 8% (0.08 as a…
Q: What is the company's price/earnings ratio?
A: Option b: This option is correct or incorrect because the P/E ratio is calculated by dividing the…
Q: General accounting
A: Explanation of Lump-Sum Purchase:A lump-sum purchase occurs when multiple assets are acquired…
Q: This problem
A: Explanation of Net Patient Accounts ReceivableNet Patient Accounts Receivable represents the amount…
Q: Sub. Account
A: We need to calculate two metrics for both 2016 and 2017: 1. Inventory Turnover Ratio (ITR): Measures…
Q: Solution
A: Explanation of Gross Profit: Gross profit is the difference between sales revenue and the cost of…
Q: general account
A: Step 1: Identify the Formula for Price with MarkupThe formula for the price with markup on total…
Q: Con
A: Explanation of Cash-Basis Accounting: Cash-basis accounting is a method of recording financial…
Q: Provide correct answer the accounting question
A: Step 1 explained above. Step 2: Step 3: Step 4:
Q: P8.6 (LO 4) (Gross Profit Method) Eastman Company lost most of its inventory in a fire in Decem- ber…
A: Step 1: The fire loss incurred is calculated as follows: Formula table: result of the above formula…
Q: Required: Account
A: To calculate the budgeted markup percentage using a full-cost approach, we need to find the ratio of…
Q: Solve the financial accounting question
A: Step 1: The total Cost for the Job to be recorded on the job sheet is the sum of Direct Materials,…
Q: ram.1
A: The problem involves the determination of the present and future value of annuity. Present value…
Q: General accounting
A: Step 1: Define Return on EquityIn the domain of finance, the return on equity financial ratio gives…
Q: MCQ FINANCIAL ACCOUNTING
A: Explanation of Time Value of Money: Time value of money is a fundamental financial concept that…
Q: Need help
A: Step 1: Define Types of AssetsAssets are classified based on three functions- convertibility,…
Q: choose right one
A: Step 1: Formula for Gross Margin PercentageThe gross margin percentage indicates how much of each…
Q: fill out with the correct calculations, whichever boxes are red.
A: Step 1: No.Account Titles and ExplanationDebit ($)Credit ($)1Accumulated depreciation23,250…
On January 1, year 1, Pungent Corporation please solve these general accounting question
Step by step
Solved in 2 steps
- On January 1, Year 1, Pacific Corporation acquired 75% of Sand Corporation's 200,000 outstanding common shares for $2,850,000. On January 1, the book value of Sand's net assets was $3,000,000. Book value equaled fair value for all of Sand's assets and liabilities except land, which had a fair value $200,000 greater than book value, and equipment, which had a fair value $150,000 greater than book value. On January 1, Year 1, Sand had a noncompete agreement with a fair value of $300,000. What is the goodwill to be reported on Pacific Corporation's December 31, Year 1 balance sheet under U.S. GAAP? $150,000 $312,500 $362,500 $450,000On January 1, Year 1, RAK, Inc acquired a 25% interest in Tech Corp. for $375,000. At the date of acquisition, the net assets had a fair value in excess of shareholders' equity of $200,000. The fair value in excess of book value is the result of equipment with a remaining useful life of four years. For the year ended December 31, Year 1. Tech had net income of $60,000 and RAK received a dividend of $10,000 from Tech. At December 31, Year 1. Tech had shareholders' equity of $820,000. What is the amount of goodwill associated with RAK's purchase of Tech? O $175,000 O $170,000 O $125,000 O $93,750On January 1, 20X1, Payne Corp. purchased 70% of Shayne Corp.'s $10 par common stock for $900,000. On this date, the carrying amount of Shayne's net assets was $1,000,000. The fair values of Shayne's identifiable assets and liabilities were the same as their carrying amounts except for plant assets (net), which were $200,000 in excess of the carrying amount. For the year ended December 31, 20X1, Shayne had net income of $150,000 and paid cash dividends totaling $90,000. Excess attributable to plant assets is amortized over 10 years. In the December 31, 20X1, consolidated balance sheet, noncontrolling interest should be reported at ____. Check Number – Excess of FV over BV = $285,714 a. $282,714 b. $300,500 c. $397,714 d. $345,500
- On January 1, 20X1, Payne Corp. purchased 70% of Shayne Corp.'s $10 par common stock for $900,000. On this date, the carrying amount of Shayne's net assets was $1,000,000. The fair values of Shayne's identifiable assets and liabilities were the same as their carrying amounts except for plant assets (net), which were $200,000 in excess of the carrying amount. For the year ended December 31, 20X1, Shayne had net income of $150,000 and paid cash dividends totaling $90,000. Excess attributable to plant assets is amortized over 10 years. In the December 31, 20X1, consolidated balance sheet, noncontrolling interest should be reported at ____. a. $282,714 b. $300,500 c. $397,714 d. $345,500On January 1, Barnyard Corporation acquired common stock of Fresh Hay Corporation. At the time of acquisition, the book value and the fair value of Fresh Hay Corporation's net assets were $1 billion. During the year, Fresh Hay Corporation reported net income of $480 million and declared dividends of $160 million. The fair value of the shares increased by 10 percent during the year. How much income would Barnyard Corporation report for the year related to its investment under the assumption that it: A. Paid $150 million for 15 percent of the common stock and uses the fair value method to account for its investment in Fresh Hay Corporation. (Pay attention to the "fair value method" mention, others who attempted to answer this question got it wrong because they missed that). B. Paid $300 million for 30 percent of the common stock and uses the equity method to account for its investment in Fresh Hay Corporation. Please show all your steps so we can follow what…On January 1, 20X1, Rabb Corp. purchased 80% of Sunny Corp.'s $10 par common stock for $975,000. On this date, the carrying amount of Sunny's net assets was $1,000,000. The fair values of Sunny's identifiable assets and liabilities were the same as their carrying amounts except for plant assets (net), which were $100,000 in excess of the carrying amount. In the January 1, 20X1, consolidated balance sheet, goodwill should be reported at ____. a. $0 b. $75,750 c. $95,000 d. $118,750
- On 30 June 20X7, Edison Ltd acquired all the assets and liabilities of Oliver Ltd, with Oliver Ltd going into liquidation. In exchange for these assets and liabilities, Edison Ltd issued 60,000 shares, and the fair value of each share at the acquisition date is $4. Costs of issuing these shares amounted to $2,000. Legal costs associated with the acquisition of Oliver Ltd amounted to $1,500. The assets and liabilities of Oliver Ltd at 30 June 20X7 were as follows: Carrying amount Fair value Cash 12 000 12 000 Accounts receivable (Cost: $45 000, Estimated uncollectable debts: $5000) 40 000 36 000 Inventory 60 000 76 000 Plant (Cost: $200 000, Accumulated 120 000 145 000 depreciation: $80 000) Accounts payable 40 000 40 000 Additional information: • Oliver Ltd had not recorded an internally developed patent. Edison Ltd valued this at $26,000. Oliver Ltd had not recorded a legal claim as a liability due to the uncertainty of an outcome. Edison Ltd estimated the fair value of this…Purse Corporation acquired 70 percent of Scarf Corporation’s ownership on January 1, 20X8, for $140,000. At that date, Scarf reported capital stock outstanding of $120,000 and retained earnings of $80,000, and the fair value of the noncontrolling interest was equal to 30 percent of the book value of Scarf. During 20X8, Scarf reported net income of $30,000 and comprehensive income of $36,000 and paid dividends of $25,000. Required: Present all consolidation entries needed at December 31, 20X8, to prepare a complete set of consolidated financial statements for Purse Corporation and its subsidiary.Purse Corporation acquired 70 percent of Scarf Corporation’s ownership on January 1, 20X8, for $140,000. At that date, Scarf reported capital stock outstanding of $120,000 and retained earnings of $80,000, and the fair value of the noncontrolling interest was equal to 30 percent of the book value of Scarf. During 20X8, Scarf reported net income of $30,000 and comprehensive income of $36,000 and paid dividends of $25,000. Required: Present all equity-method entries that Purse would have recorded in accounting for its investment in Scarf during 20X8.
- On January 2, 2021, Normal Inc. acquired 15% interest in Laco Co. by paying P1,500,000 for 7,500 ordinary shares. On this date, the net assets of Laco Co. totaled P9 million. The investment was classified as a financial asset at fair value through other comprehensive income. The fair values of Laco Co.’s identifiable assets and liabilities approximate their book values. On August 1, 2021, Normal received dividends of P4 per share from Laco Co. Fair value of the stocks on December 31, 2021 was P190. Net income reported by Laco for the year ended amounted to P1,500,000. On July 1, 2022, Normal Inc. paid P1 million to purchase 5,000 additional shares of Laco Co. from another shareholder. On this date the fair value of the net assets exceeds carrying value by P500,000 attributable to depreciable asset with estimated remaining life of 5 years. On February 1, 2022, cash dividends of P5 were received while dividends of P6 were received on August 1, 2022. Net income reported for the year ended…On January 1, 20X7, Phillips Corporation acquired 35 percent of the outstanding shares of Shell Corporation for $100,000 cash. Shell Company reported net income of $175,000 and paid dividends of $25,000 for both 20X7 and 20X8. The fair value of shares held by Phillips was $310,000 and $325,000 on December 31, 20X7 and 20X8 respectively.Based on the preceding information, what amount will be reported by Phillips as its basis in the Shell investment for 20X7, if it used the equity method of accounting? Group of answer choices $122,500 $161,250 $100,000 $152,500On January 1, 20X6, Plus Corporation acquired 90 percent of Side Corporation for $180,000 cash. Side reported net income of $30,000 and dividends of $10,000 for 20X6, 20X7, and 20X8. On January 1, 20X6, Side reported common stock outstanding of $100,000 and retained earnings of $60,000, and the fair value of the noncontrolling interest was $20,000. It held land with a book value of $30,000 and a market value of $35,000 and equipment with a book value of $50,000 and a market value of $60,000 at the date of combination. The remainder of the differential at acquisition was attributable to an increase in the value of patents, which had a remaining useful life of five years. All depreciable assets held by Side at the date of acquisition had a remaining economic life of five years. Plus uses the equity method in accounting for its investment in Side. 1) Based on the preceding information, the increase in the fair value of patents held by Side is: A. $20,000 B. $25,000 C. $15,000 D. $5,000 2)…