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Question 1 0/1 pts On May 1, Beta Co. reported the following account balances along with their estimated fair values: Receivables Inventory Copyrights Patented technology Carrying Amount Fair Value $ 219,000 $ 219,000 92,000 92,000 152,000 533,000 832,000 677,000 Total assets $ 1.295,000 $ 1.521,000 Current liabilities $ 256,000 $ 256,000 Long-term liabilities 685,000 673,000 Common stock 100,000 Retained earnings 254,000 Total liabilities and equities $ 1,295,000 On that day, Alpha paid cash $743,800 to acquire all of the assets and liabilities of Beta, which will cease to exist as a separate entity. To facilitate the merger, Alpha also paid $101,500 to an investment banking firm. The following information was also available: 1. Alpha further agreed to pay an extra $81,400 to the former owners of Beta only if they meet certain revenue goals during the next two years. Alpha estimated the present value of its probability adjusted expected payment for this contingency at $40,700. 2. Beta has a research and development project in process with an appraised value of $210,500. However, the project has not yet reached technological feasibility and the project's assets have no alternative future use. In recording acquisition of Beta, Alpha would record gain on bargain purchase of: $36,200. $0 $58,700. $18,000.

Question 1 0/1 pts On May 1, Beta Co. reported the following account balances along with their estimated fair values: Receivables Inventory Copyrights Patented technology Carrying Amount Fair Value $ 219,000 $ 219,000 92,000 92,000 152,000 533,000 832,000 677,000 Total assets $ 1.295,000 $ 1.521,000 Current liabilities $ 256,000 $ 256,000 Long-term liabilities 685,000 673,000 Common stock 100,000 Retained earnings 254,000 Total liabilities and equities $ 1,295,000 On that day, Alpha paid cash $743,800 to acquire all of the assets and liabilities of Beta, which will cease to exist as a separate entity. To facilitate the merger, Alpha also paid $101,500 to an investment banking firm. The following information was also available: 1. Alpha further agreed to pay an extra $81,400 to the former owners of Beta only if they meet certain revenue goals during the next two years. Alpha estimated the present value of its probability adjusted expected payment for this contingency at $40,700. 2. Beta has a research and development project in process with an appraised value of $210,500. However, the project has not yet reached technological feasibility and the project's assets have no alternative future use. In recording acquisition of Beta, Alpha would record gain on bargain purchase of: $36,200. $0 $58,700. $18,000.

Survey of Accounting (Accounting I)
Survey of Accounting (Accounting I)
8th Edition
ISBN:9781305961883
Author:Carl Warren
Publisher:Carl Warren
Chapter6: Receivables And Inventories
Section: Chapter Questions
Problem 6.2MBA: Allowance method Using transactions listed in £6-S. indicate the effects of each transaction on the...
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Question 1 0/1 pts On May 1, Beta Co. reported the following account balances along with their estimated fair values: Receivables Inventory Copyrights Patented technology Carrying Amount Fair Value $ 219,000 $ 219,000 92,000 92,000 152,000 533,000 832,000 677,000 Total assets $ 1.295,000 $ 1.521,000 Current liabilities $ 256,000 $ 256,000 Long-term liabilities 685,000 673,000 Common stock 100,000 Retained earnings 254,000 Total liabilities and equities $ 1,295,000 On that day, Alpha paid cash $743,800 to acquire all of the assets and liabilities of Beta, which will cease to exist as a separate entity. To facilitate the merger, Alpha also paid $101,500 to an investment banking firm. The following information was also available: 1. Alpha further agreed to pay an extra $81,400 to the former owners of Beta only if they meet certain revenue goals during the next two years. Alpha estimated the present value of its probability adjusted expected payment for this contingency at $40,700. 2. Beta has a research and development project in process with an appraised value of $210,500. However, the project has not yet reached technological feasibility and the project's assets have no alternative future use. In recording acquisition of Beta, Alpha would record gain on bargain purchase of: $36,200. $0 $58,700. $18,000.
Transcribed Image Text:Question 1 0/1 pts On May 1, Beta Co. reported the following account balances along with their estimated fair values: Receivables Inventory Copyrights Patented technology Carrying Amount Fair Value $ 219,000 $ 219,000 92,000 92,000 152,000 533,000 832,000 677,000 Total assets $ 1.295,000 $ 1.521,000 Current liabilities $ 256,000 $ 256,000 Long-term liabilities 685,000 673,000 Common stock 100,000 Retained earnings 254,000 Total liabilities and equities $ 1,295,000 On that day, Alpha paid cash $743,800 to acquire all of the assets and liabilities of Beta, which will cease to exist as a separate entity. To facilitate the merger, Alpha also paid $101,500 to an investment banking firm. The following information was also available: 1. Alpha further agreed to pay an extra $81,400 to the former owners of Beta only if they meet certain revenue goals during the next two years. Alpha estimated the present value of its probability adjusted expected payment for this contingency at $40,700. 2. Beta has a research and development project in process with an appraised value of $210,500. However, the project has not yet reached technological feasibility and the project's assets have no alternative future use. In recording acquisition of Beta, Alpha would record gain on bargain purchase of: $36,200. $0 $58,700. $18,000.
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