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- Plaza, Incorporated, acquires 80 percent of the outstanding common stock of Stanford Corporation on January 1, 2024, in exchange for $941, 800 cash. At the acquisition date, Stanford's total fair value, including the noncontrolling interest, was assessed at $1,177,250. Also at the acquisition date, Stanford's book value was $546, 100. Several individual items on Stanford's financial records had fair values that differed from their book values as follows: Items Book Value Fair Value Trade names (indefinite life) $ 300, 900 $ 360, 900 Property and equipment (net, 8-year remaining life) 233, 600 262, 400 Patent (14-year remaining life) 120, 900 154, 500 For internal reporting purposes, Plaza, Incorporated, employs the equity method to account for this investment. The following account balances are for the year ending December 31, 2024, for both companies. Accounts Plaza Stanford Revenues $ (795, 100) $ (782,600) Cost of goods sold 439, 600 331, 000 Depreciation expense 186, 400 29, 200…Padre, Inc., buys 80 percent of the outstanding common stock of Sierra Corporation on January 1, 2018, for $802,720 cash. At the acquisition date, Sierra’s total fair value, including the noncontrolling interest, was assessed at $1,003,400 although Sierra’s book value was only $690,000. Also, several individual items on Sierra’s financial records had fair values that differed from their book values as follows: Book Value Fair Value Land $ 65,000 $ 290,000 Buildings andequipment (10-year remaining life) 287,000 263,000 Copyright (20-year remaining life) 122,000 216,000 Notes payable (due in 8 years) (176,000) (157,600) For internal reporting purposes, Padre, Inc., employs the equity method to account for this investment. The following account balances are for the year ending December 31, 2018, for both companies. Padre Sierra Revenues $(1,394,980) $ (684,900) Cost of goods sold 774,000 432,000 Depreciation expense 274,000 11,600…Plaza, Incorporated, acquires 80 percent of the outstanding common stock of Stanford Corporation on January 1, 2024, in exchange for $985,400 cash. At the acquisition date, Stanford’s total fair value, including the noncontrolling interest, was assessed at $1,231,750. Also at the acquisition date, Stanford's book value was $532,500. Several individual items on Stanford’s financial records had fair values that differed from their book values as follows: Items Book Value Fair Value Trade names (indefinite life) $ 301,200 $ 354,900 Property and equipment (net, 8-year remaining life) 232,000 255,200 Patent (14-year remaining life) 120,400 161,000 For internal reporting purposes, Plaza, Incorporated, employs the equity method to account for this investment. The following account balances are for the year ending December 31, 2024, for both companies. Accounts Plaza Stanford Revenues $ (828,200) $ (746,500) Cost of goods sold 458,700 321,700 Depreciation expense…
- Padre, Incorporated, buys 80 percent of the outstanding common stock of Sierra Corporation on January 1, 2024, for $791,520 cash. At the acquisition date, Sierra's total fair value, including the noncontrolling interest, was assessed at $989,400, although Sierra's book value was only $638,000. Also, several individual items on Sierra's financial records had fair values that differed from their book values as follows: Account Land Buildings and equipment (10-year remaining life) Copyright (20-year remaining life) Notes payable (due in 8 years) Book Value $ 65,200 295,000 Fair Value $ 307,200 276,000 104,000 (187,000) 218,000 (172,600) For internal reporting purposes, Padre, Incorporated, employs the equity method to account for this investment. The following account balances are for the year ending December 31, 2024, for both companies. Account Revenues Cost of goods sold Depreciation expense Amortization expense Interest expense Equity in income of Sierra Net income Retained earnings,…Padre, Inc., buys 80 percent of the outstanding common stock of Sierra Corporation on January 1, 2021, for $802,720 cash. At the acquisition date, Sierra’s total fair value, including the noncontrolling interest, was assessed at $1,003,400 although Sierra’s book value was only $690,000. Also, several individual items on Sierra’s financial records had fair values that differed from their book values as follows: Book Value Fair Value Land $ 65,000 $ 290,000 Buildings and equipment (10-year remaining life) 287,000 263,000 Copyright (20-year remaining life) 122,000 216,000 Notes payable (due in 8 years) (176,000 ) (157,600 ) For internal reporting purposes, Padre, Inc., employs the equity method to account for this investment. The following account balances are for the year ending December 31, 2021, for both companies. Padre Sierra Revenues $ (1,394,980 ) $ (684,900 ) Cost of goods sold 774,000 432,000…Padre, Inc., buys 80 percent of the outstanding common stock of Sierra Corporation on January 1, 2021, for $802,720 cash. At the acquisition date, Sierra's total fair value, including the noncontrolling interest, was assessed at $1,003,400 although Sierra's book value was only $690,000. Also, several individual items on Sierra's financial records had fair values that differed from their book values as follows: Book Value Fair Value $ 65,000 287,000 $ 290,000 263,000 216,000 (157,600) Land Buildings and equipment (10-year remaining life) Copyright (20-year remaining life) Notes payable (due in 8 years) 122,000 (176,000) For internal reporting purposes, Padre, Inc., employs the equity method to account for this investment. The following account balances are for the year ending December 31, 2021, for both companies. Padre Sierra $(1,394,980) 774,000 274,000 (684,900) 432,000 11,600 6,100 9,200 Revenues Cost of goods sold Depreciation expense Amortization expense Interest expense 52,100…
- Plaza, Inc., acquires 80 percent of the outstanding common stock of Stanford Corporation on January 1, 2018, in exchange for $900,000 cash. At the acquisition date, Stanford’s total fair value, including the noncontrolling interest, was assessed at $1,125,000. Also at the acquisition date, Stanford’s book value was $690,000.Several individual items on Stanford’s financial records had fair values that differed from their book values as follows:For internal reporting purposes, Plaza, Inc., employs the equity method to account for this investment. The following account balances are for the year ending December 31, 2018, for both companies.At year-end, there were no intra-entity receivables or payables.Prepare a worksheet to consolidate the financial statements of Plaza, Inc., and its subsidiary Stanford.Plaza, Inc., acquires 80 percent of the outstanding common stock of Stanford Corporation on January 1, 2018, in exchange for $1,079,300 cash. At the acquisition date, Stanford’s total fair value, including the noncontrolling interest, was assessed at $1,349,125. Also at the acquisition date, Stanford's book value was $565,100. Several individual items on Stanford’s financial records had fair values that differed from their book values as follows: Book Value Fair Value Tradenames (indefinite life) $ 292,900 $ 439,200 Property and equipment (net, 8-year remaining life) 241,600 260,000 Patent ( 14-year remaining life) 140,400 182,400 For internal reporting purposes, Plaza, Inc., employs the equity method to account for this investment. The following account balances are for the year ending December 31, 2018, for both companies. Plaza Stanford Revenues $ (938,600) $ (719,900) Cost of Good sold 518,900 322,400 Depreciation Expense 219,900 30,200 Amortization…Plaza, Inc., acquires 80 percent of the outstanding common stock of Stanford Corporation on January 1, 2021, in exchange for $900,000 cash. At the acquisition date, Stanford’s total fair value, including the noncontrolling interest, was assessed at $1,125,000. Also at the acquisition date, Stanford's book value was $690,000. Several individual items on Stanford’s financial records had fair values that differed from their book values as follows: Book Value Fair Value Trade names (indefinite life) $ 360,000 $ 383,000 Property and equipment (net, 8-year remaining life) 290,000 330,000 Patent (14-year remaining life) 132,000 272,000 For internal reporting purposes, Plaza, Inc., employs the equity method to account for this investment. The following account balances are for the year ending December 31, 2021, for both companies. Plaza Stanford Revenues $ (1,400,000 ) $ (825,000 ) Cost of goods sold 774,000 395,750…
- On July 19, 2021, SUNOB acquired 60% of the outstanding shares of YSAE. The business combination resulted to a gain on bargain purchase of P200,000. The consideration paid was exactly the fair value for the 60% outstanding stocks, and the fair value of the non-controlling interest is not given. Fair value of the net assets of YSAE amounted to P1,000,000 on that date. How much is the gain on acquisition attributable to SUNOB? Zero 600,000 200,000 120,000Padre, Inc., buys 80 percent of the outstanding common stock of Sierra Corporation on January 1, 2021, for $802,720 cash. At the acquisition date, Sierra's total fair value, including the noncontrolling interest, was assessed at $1,003,400 although Sierra's book value was only $690,000. Also, several individual items on Sierra's financial records had fair values that differed from their book values as follows: Book Value Land $ 65,000 Fair Value $ 290,000 Buildings and equipment (10-year remaining life) 287,000 Copyright (20-year remaining life) Notes payable (due in 8 years) 122,000 (176,000) 263,000 216,000 (157,600) For internal reporting purposes, Padre, Inc., employs the equity method to account for this investment. The following account balances are for the year ending December 31, 2021, for both companies. Padre Revenues Cost of goods sold Depreciation expense Amortization expense Interest expense Equity in income of Sierra Net income Retained earnings, 1/1/21 Net income…On July 19, 2021, SUNOB acquired 60% of the outstanding shares of YSAE. The business combination resulted to a gain on bargain purchase of P200,000. The consideration paid was exactly the fair value for the 60% outstanding stocks, and the fair value of the non-controlling interest is not given. Fair value of the net assets of YSAE amounted to P1,000,000 on that date. How much is the gain on acquisition attributable to SUNOB? Group of answer choices a.600,000 b.120,000 c.Zero d.200,000