l touch ?1:28 PM49%Expert Q&ADoneP Company wishes to acquire SCo. for cash in an asset acquisition, andappraisals reveal that the inventory has a fair value $195,000, and the equipmenthas a current value of $625,000. The book value and fair value of liabilities arethe same. The following balance sheets were reported on January 1, 2011, for PCompany and S Company:S Co.$ 30,000P Co.Cash$ 150,000InventoryEquipment (net)450,000150,0001,320,000570,000Total$1,920,000$750,000$ 450,000Total liabilitiesCommon stock, $20 par valueOther contributed capitalRetained earnings$150,000600,000300,000375,000105,000495,000$1,920,000195,000Total$750,000Determine the purchase price above which P Co. would record goodwill.*O $705,000O $710,000O S700,000$695,000O None of the options is correctDetermine the purchase price at which P Co. would record a $30.000 gain."O $685,000O $670,000$690,000O s665.000O None of the options is correct

Goodwill on acquisition is arising on paying the amount over the net identifiable assets of the…

P Company wishes to acquire S Co. for cash in an asset acquisition, and appraisals reveal that the inventory has a fair value $195,000, and the equipment has a current value of $625,000. The book value and fair value of liabilities are the same. The following balance sheets were reported on January 1, 2011, for P Company and S Company: S Co. $ 30,000 P Co. Cash $ 150,000 Inventory 450,000 150,000 Equipment (net) Total 1,320,000 $1.920,000 570,000 $750,000 Total liabilities $ 450,000 $150,000 Common stock, $20 par value Other contributed capital Retained earnings 600,000 375,000 300,000 105,000 195,000 $750,000 495,000 Total $1,920,000 Determine the purchase price above which P Co. would record goodwill. O $705,000 $710,000 O $700,000 O $695,000 O None of the options is correct Determine the purchase price at which P Co. would record a $30.000 gain." O $685,000 O $670,000 O $690,000 O s665.000 O None of the options is correct O O O OO O O O OC

P Company wishes to acquire S Co. for cash in an asset acquisition, and appraisals reveal that the inventory has a fair value $195,000, and the equipment has a current value of $625,000. The book value and fair value of liabilities are the same. The following balance sheets were reported on January 1, 2011, for P Company and S Company: S Co. $ 30,000 P Co. Cash $ 150,000 Inventory 450,000 150,000 Equipment (net) Total 1,320,000 $1.920,000 570,000 $750,000 Total liabilities $ 450,000 $150,000 Common stock, $20 par value Other contributed capital Retained earnings 600,000 375,000 300,000 105,000 195,000 $750,000 495,000 Total $1,920,000 Determine the purchase price above which P Co. would record goodwill. O $705,000 $710,000 O $700,000 O $695,000 O None of the options is correct Determine the purchase price at which P Co. would record a $30.000 gain." O $685,000 O $670,000 O $690,000 O s665.000 O None of the options is correct O O O OO O O O OC

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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Mans Company is about to purchase the net assets of Eagle Incorporated, which has the following balance sheet: Assets Accounts receivable $ 60,000 Inventory 100,000 Equipment $ 90,000 Accumulated depreciation (50,000) 40,000 Land and buildings $300,000 Accumulated depreciation (100,000) 200,000 Goodwill 60,000 Total assets $460,000 Liabilities and Stockholders' Equity Bonds payable $ 80,000 Common stock, $10 par 200,000 Paid-in capital in excess of par 100,000 Retained earnings 80,000 Total liabilities and equity $460,000 Mans has secured the following fair values of Eagle's accounts: Inventory $130,000 Equipment 60,000 Land and buildings 260,000 Bonds payable 60,000 Acquisition costs were $20,000. Required: Record the entry for the purchase of…
On September 1, 2017, Winans Corporation acquired Aumont Enterprises for a cash payment of $700,000, At the time of purchase, Aumont's Balance sheet showed assets of $620,000 Liabilities of $200.000 and owners equity of $420,000, The fair value of Aumonts assets is estimated to be $800 000. Compute the amount of good will acquired by Winans. O S80 000 O $100.000 O $180 000 O All of the above
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CASE 1 Presented below are the financial balances for the BonGiovi Company and the Terens Company as of December 31, 2017, immediately before BonGiovi acquired Terens. Also included are the fair values for Terens Company's net assets at that date (thousands of US$). Terens Compute consolidated retained earnings as a result of this acquisition. A) $1,160. Compute consolidated revenues immediately following the acquisition. BonGiovi Book Value Terens Book Value B) $1,170. 31.12.2017 31.12.2017 Fair Value 31.12.2017 C) $1,265. Cash 870 240 240 Receivables 660 600 600 D) $1,280. Inventory 1,230 420 580 Land 1,800 260 250 E) $1,650. Buildings (Net) 1,800 540 650 Equipment (net) 660 380 400 Accounts Payable (570) (240) (240) Accrued expenses (270) (60) Long term Liabilities (2,700) (1,020) (60) (1,120) Common Stock (1,980) A) $3,540. ($20par) B) $2,880. Common Stock ($5 (420) par) C) $1,170. Additional paid in (210) (180) capital D) $1,650. Retained earnings (1,170) (480) Revenue (2,880)…