Pab Corporation decided to establish Sollon Company as a wholly owned subsidiary by transferring some of its existing assets andliabilities to the new entity. In exchange, Sollon issued Pab 34,000 shares of $7 par value common stock. The following information isprovided on the assets and accounts payable transferred:CashInventoryLandBuildingsEquipmentAccounts PayableRequired ARequired:a. Prepare the journal entry that Pab recorded for the transfer of assets and accounts payable to Sollonb. Prepare the journal entry that Sollon recorded for the receipt of assets and accounts payable from Pab.Complete this question by entering your answers in the tabs below.Required BView transaction listCost$ 38,00089,00061,000174,00099,00045,000APrepare the journal entry that Pab recorded for the transfer of assets and accounts payable to Sollon.Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.Journal entry worksheetBook Value$ 38,00089,00061,000136,00070,00045,000Event1Note: Enter debits before credits.Record the transfer of assets and accounts payable to Sollon.Record entryFair Value$ 38,00089,00091,000248,000108,00045,000General JournalClear entryDebitCreditView general journal

Journal entries for Pab Corporation regarding the transfer of assets and the corresponding accounts…

Pab Corporation decided to establish Sollon Company as a wholly owned subsidiary by transferring some of its existing assets and liabilities to the new entity. In exchange, Sollon issued Pab 34,000 shares of $7 par value common stock. The following information is provided on the assets and accounts payable transferred: Cash Inventory. Land Buildings. Equipment Accounts Payable Cost $ 38,000 89,000 61,000 174,000 99,000 45,000 Book Value $ 38,000 89,000 61,000 136,000 70,000 45,000 Fair Value $ 38,000 89,000 91,000 248,000 108,000 45,000 Required: a. Prepare the journal entry that Pab recorded for the transfer of assets and accounts payable to Sollon b. Prepare the journal entry that Sollon recorded for the receipt of assets and accounts payable from Pab.

Pab Corporation decided to establish Sollon Company as a wholly owned subsidiary by transferring some of its existing assets and liabilities to the new entity. In exchange, Sollon issued Pab 34,000 shares of $7 par value common stock. The following information is provided on the assets and accounts payable transferred: Cash Inventory. Land Buildings. Equipment Accounts Payable Cost $ 38,000 89,000 61,000 174,000 99,000 45,000 Book Value $ 38,000 89,000 61,000 136,000 70,000 45,000 Fair Value $ 38,000 89,000 91,000 248,000 108,000 45,000 Required: a. Prepare the journal entry that Pab recorded for the transfer of assets and accounts payable to Sollon b. Prepare the journal entry that Sollon recorded for the receipt of assets and accounts payable from Pab.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

HELP ME
Mainline Produce Corporation acquired all the outstanding common stock of Iceberg Lettuce Corporation for $32,000,000 in cash. The book values and fair values of Iceberg's assets and liabilities were as follows: Book Value Fair Value $ 12,000,000 $ 15,000,000 21,400,000 3,600,000 8,000,000 14,000,000 Current assets Property, plant, and equipment Other assets 27,400,000 4,600,000 8,000,000 13,000,000 Current liabilities Long-term liabilities Required: Calculate the amount paid for goodwill. (Enter your answer in millions (i.e. 5,000,000 should be entered as 5).) Amount paid for goodwill million
Professor Corporation acquired 70 percent of Scholar Corporation's common stock on December 31, 20X4, for $102,200. The fair value of the noncontrolling interest at that date was determined to be $43,800. Data from the balance sheets of the two companies included the following amounts as of the date of acquisition: Item Cash Accounts Receivable Inventory Land Buildings & Equipment Less: Accumulated Depreciation Investment in Scholar Corporation Total Assets Accounts Payable Mortgage Payable Common Stock Retained Earnings Total Liabilities & Stockholders' Equity Assets Cash Professor Scholar Corporation Corporation $50,300 Accounts receivable Inventory Land Buildings and equipment Less: Accumulated depreciation Investment in Scholar Corporation Total Assets Liabilities & Equity Accounts payable Mortgage payable Common stock Retained earnings NCI in Net assets of Scholar Corporation Total Liabilities & Equity 90,000 130,000 60,000 410,000 (150,000) 102,200 $ 692,500 $152,500 250,000…
Pab Corporation decided to establish Sollon Company as a wholly owned subsidiary by transferring some of its existing assets and liabilities to the new entity. In exchange, Sollon issued Pab 35,000 shares of $7 par value common stock. The following information is provided on the assets and accounts payable transferred: Cost Book Value Fair Value Cash $ 32,000 $ 32,000 $ 32,000 Inventory 83,000 83,000 83,000 Land 69,000 69,000 99,000 Buildings 188,000 147,000 249,000 Equipment 95,000 74,000 123,000 Accounts Payable 58,000 58,000 58,000 Required: Prepare the journal entry that Pab recorded for the transfer of assets and accounts payable to Sollon Prepare the journal entry that Sollon recorded for the receipt of assets and accounts payable from Pab.
On May 1, Burns Corporation acquired 100 percent of the outstanding ownership shares of Quigley Corporation in exchange for $728,000 cash. At the acquisition date, Quigley's book and fair values were as follows: Cash Receivables Inventory Land Building and equipment (net) Patented technology Total assets Accounts payable Long-term liabilities Common stock ($5 par value) Additional paid-in capital Retained earnings Total liabilities and stockholders equity Total assets Assets Book Value $ 112,000 $ 218,000 232,000 $ 177,000 323,000 0 $1,062,000 $ 162,500 $ 638,000 210,000 90,000 (38,500) $1,062,000 Burns directs Quigley to seek additional financing for expansion through a new long-term debt issue. Consequently, Quigley will issue a set of financial statements separate from that of its new parent to support its request for debt and accompanying regulatory filings. Quigley elects to apply pushdown accounting in order to show recent fair valuations for its assets. Prepare a separate…
Presented below is information related to Concord Company 1. On July 6, Concord Company acquired the plant assets of Doonesbury Company, which had discontinued operations. The appraised value of the property is: Land Buildings Equipment Total Concord Company gave 12.500 shares of its $100 par value common stock in exchange. The stock had a market price of $168 per share on the date of the purchase of the property 2. Concord Company expended the following amounts in cash between July 6 and December 15, the date when it first occupied the building. Repairs to building Construction of bases for equipment to be installed later Driveways and parking lots Remodeling of office space in building including new partitions and walls Special assessment by city on land 3. On December 20, the company paid cash for equipment, $234.000, subject to a 2% cash discount, and freight on equipment of $9.450. Prepare entries on the books of Concord Company for these transactions. (Do not round intermediate…
8. Kopi Company acquired all of the outstanding ordinary shares of an acquiree paying P9,000,000 cash. The carrying amount and fair value of the assets and liabilities of the acquiree were: Carrying amount Fair Value Accounts receivable P 1,500,000 Inventory 4,800,000 Land 7,500,000 Property and Equipment 2,500,000 Accounts payable 2,500,000 Bonds Payable 1,900,000 P 1,200,000 3,000,000 5,000,000 2,000,000 2,500,000 1,500,000 What amount should be recognized as goodwill or negative goodwill? a. P 1,900,000 b. P-1,900,000 c. P 2,900,000 d. P-2,900,000
Phone Corporation acquired 70 percent of Smart Corporation’s common stock on December 31, 20X4, for $98,000. At that date, the fair value of the noncontrolling interest was $42,000. Data from the balance sheets of the two companies included the following amounts as of the date of acquisition: Item Phone Corporation Smart Corporation Cash $ 52,300 $ 39,000 Accounts Receivable 99,000 59,000 Inventory 136,000 92,000 Land 66,000 49,000 Buildings & Equipment 417,000 268,000 Less: Accumulated Depreciation (151,000) (73,000) Investment in Smart Corporation 98,000 Total Assets $ 717,300 $ 434,000 Accounts Payable $ 141,500 $ 27,000 Mortgage Payable 300,800 288,000 Common Stock 72,000 40,000 Retained Earnings 203,000 79,000 Total Liabilities & Stockholders’ Equity $ 717,300 $ 434,000 At the date of the business combination, the book values of Smart’s assets and liabilities approximated fair value except for inventory, which had a fair value of…
On May 1, Burns Corporation acquired 100 percent of the outstanding ownership shares of Quigley Corporation in exchange for $733,000 cash. At the acquisition date, Quigley's book and fair values were as follows: Cash Receivables Inventory Land Building and equipment (net) Patented technology Total assets Accounts payable Long-term liabilities Common stock ($5 par value) Additional paid-in capital Retained earnings Total liabilities and stockholders equity Total assets Book Value Fair Value $ 101,000 $ 101,000 229,000 229,000 254,000 323,000 157,500 118,500 330,000 409,000 0 220,000 Assets $1,071,500 $ 1,400,500 $ 146,000 $ 666,000 210,000 90,000 (40,500) $1,071,500 Burns directs Quigley to seek additional financing for expansion through a new long-term debt issue. Consequently, Quigley will issue a set of financial statements separate from that of its new parent to support its request for debt and accompanying regulatory filings. Quigley elects to apply pushdown accounting in order to…
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…
could you answer part B please? Pagle Corporation established a subsidiary to enter into a new line of business considered to be substantially more risky than Pagle's current business. Pagle transferred the following assets and accounts payable to Sand Corporation in exchange for 5,000 shares of $10 par value stock of Sand: Cash Accounts Receivable Inventory Land Buildings and Equipment Accounts Payable Cost $ 30,000 45,000 60,000 20,000 300,000 10,000 Required B Book Value $ 30,000 40,000 60,000 20,000 260,000 10,000 Required: a. Prepare the journal entry that Pagle recorded for the transfer of assets and accounts payable to Sand. b. Prepare the journal entry that Sand recorded for receipt of the assets and accounts payable from Pagle. Complete this question by entering your answers in the tabs below. Required A Prepare the journal entry that Sand recorded for receipt of the assets and accounts payable from Pagle. Note: If no entry is required for a transaction/event, select "No…
Professor Corporation acquired 70 percent of Scholar Corporation's common stock on December 31, 20X4, fr $102,200. The fair value of the noncontrolling interest at that date was determined to be $43,800. Data from the balance sheets of the two companies Included the following amounts as of the date of acquisition: Item Cash Accounts Receivable Inventory Land Buildings & Equipment Less: Accumulated Depreciation. Investment in Scholar Corporation Total Assets Accounts Payable Mortgage Payable Common Stock Retained Earnings Total Liabilities & Stockholders' Equity Professor Corporation $ 50,300 90,000 Scholar Corporation $21,000 44,000 130,000 75,000 60,000 30,000 410,000 250,000 (150,000) (80,000) 102,200 $ 692,500 $340,000 $ 152,500 $ 35,000 250,000 180,000 80,000 40,000 210,000 85,000 $ 692,500 $340,000 At the date of the business combination, the book values of Scholar's assets and liabilities approximated fair value except for Inventory, which had a fair value of $81,000, and…