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On May 1, Soriano Company reported the following account balances along with their estimated fair values: Carrying Amount $ 133,500 77,000 154,500 911,000 Fair Value $ 133,500 77,000 530,500 737,000 $ 1,276,000 $ 1,478,000 Items Receivables Inventory Copyrights Patented technology Total assets Current liabilities Long-term liabilities Common stock Retained earnings Total liabilities and equities $ 190,000 756,000 100,000 230,000 $ 1,276,000 On that day, Zambrano paid cash to acquire all of the assets and liabilities of Soriano, which will cease to exist as a separate entity. To facilitate the merger, Zambrano also paid $131,000 to an Investment banking firm. The following information was also available: • Zambrano further agreed to pay an extra $84,400 to the former owners of Soriano only if they meet certain revenue goals during the next two years. Zambrano estimated the present value of its probability adjusted expected payment for this contingency at $42,200. View transaction list $ 190,000 738,200 • Soriano has a research and development project in process with an appraised value of $206,000. However, the project has not yet reached technological feasibility, and the project's assets have no alternative future use. Journal entry worksheet 2 3 4 < 1 0 0 0 Required: a. and b. Prepare Zambrano's Journal entries to record the Soriano acquisition assuming its initial cash payment to the former owners was (a) $689,400 and (b) $806,200. Note: If no entry is required for a transaction/event, select "No Journal entry required" In the first account field. Record the acquisition of Soriano Company. Assume its initial cash payment to the former owners was $689,400. >

On May 1, Soriano Company reported the following account balances along with their estimated fair values: Carrying Amount $ 133,500 77,000 154,500 911,000 Fair Value $ 133,500 77,000 530,500 737,000 $ 1,276,000 $ 1,478,000 Items Receivables Inventory Copyrights Patented technology Total assets Current liabilities Long-term liabilities Common stock Retained earnings Total liabilities and equities $ 190,000 756,000 100,000 230,000 $ 1,276,000 On that day, Zambrano paid cash to acquire all of the assets and liabilities of Soriano, which will cease to exist as a separate entity. To facilitate the merger, Zambrano also paid $131,000 to an Investment banking firm. The following information was also available: • Zambrano further agreed to pay an extra $84,400 to the former owners of Soriano only if they meet certain revenue goals during the next two years. Zambrano estimated the present value of its probability adjusted expected payment for this contingency at $42,200. View transaction list $ 190,000 738,200 • Soriano has a research and development project in process with an appraised value of $206,000. However, the project has not yet reached technological feasibility, and the project's assets have no alternative future use. Journal entry worksheet 2 3 4 < 1 0 0 0 Required: a. and b. Prepare Zambrano's Journal entries to record the Soriano acquisition assuming its initial cash payment to the former owners was (a) $689,400 and (b) $806,200. Note: If no entry is required for a transaction/event, select "No Journal entry required" In the first account field. Record the acquisition of Soriano Company. Assume its initial cash payment to the former owners was $689,400. >

FINANCIAL ACCOUNTING
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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On May 1, Soriano Company reported the following account balances along with their estimated fair values: Carrying Amount $ 133,500 77,000 Fair Value $ 133,500 77,000 530,500 737,000 154,500 911,000 $ 1,276,000 $ 1,478,000 Receivables Inventory Copyrights Patented technology Items Total assets Current liabilities Long-term liabilities Common stock Retained earnings Total liabilities and equities On that day, Zambrano paid cash to acquire all of the assets and liabilities of Soriano, which will cease to exist as a separate entity. To facilitate the merger, Zambrano also paid $131,000 to an investment banking firm. The following information was also available: • Zambrano further agreed to pay an extra $84,400 to the former owners of Soriano only if they meet certain revenue goals during the next two years. Zambrano estimated the present value of its probability adjusted expected payment for this contingency at $42,200. • Soriano has a research and development project in process with an appraised value of $206,000. However, the project has not yet reached technological feasibility, and the project's assets have no alternative future use. View transaction list Required: a. and b. Prepare Zambrano's journal entries to record the Soriano acquisition assuming its initial cash payment to the former owners was (a) $689,400 and (b) $806,200. Note: If no entry is required for a transaction/event, select "No Journal entry required" In the first account field. Journal entry worksheet < $ 190,000 756,000 100,000 230,000 $ 1,276,000 1 $ 190,000 738, 200 0 0 0 2 3 4 Record the acquisition of Soriano Company. Assume its initial cash payment to the former owners was $689,400.
Transcribed Image Text:On May 1, Soriano Company reported the following account balances along with their estimated fair values: Carrying Amount $ 133,500 77,000 Fair Value $ 133,500 77,000 530,500 737,000 154,500 911,000 $ 1,276,000 $ 1,478,000 Receivables Inventory Copyrights Patented technology Items Total assets Current liabilities Long-term liabilities Common stock Retained earnings Total liabilities and equities On that day, Zambrano paid cash to acquire all of the assets and liabilities of Soriano, which will cease to exist as a separate entity. To facilitate the merger, Zambrano also paid $131,000 to an investment banking firm. The following information was also available: • Zambrano further agreed to pay an extra $84,400 to the former owners of Soriano only if they meet certain revenue goals during the next two years. Zambrano estimated the present value of its probability adjusted expected payment for this contingency at $42,200. • Soriano has a research and development project in process with an appraised value of $206,000. However, the project has not yet reached technological feasibility, and the project's assets have no alternative future use. View transaction list Required: a. and b. Prepare Zambrano's journal entries to record the Soriano acquisition assuming its initial cash payment to the former owners was (a) $689,400 and (b) $806,200. Note: If no entry is required for a transaction/event, select "No Journal entry required" In the first account field. Journal entry worksheet < $ 190,000 756,000 100,000 230,000 $ 1,276,000 1 $ 190,000 738, 200 0 0 0 2 3 4 Record the acquisition of Soriano Company. Assume its initial cash payment to the former owners was $689,400.
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