Summer Company holds assets with a fair value of $122,000 and a book value of $93,000 and liabilities with a book value and fair value of $22,000. Required: Compute the following amounts if Parade Corporation acquires 75 percent ownership of Summer: a. What amount did Parade pay for the shares if no goodwill and no gain on a bargain purchase are reported? Acquisition price b. What amount did Parade pay for the shares if the fair value of the noncontrolling interest at acquisition is $32,500 and goodwill of $30,000 is reported? Acquisition price c. What balance will be assigned to the noncontrolling interest in the consolidated balance sheet if Parade pays $97,500 to acquire its ownership and goodwill of $30,000 is reported? Balance assigned to noncontrolling interest
Summer Company holds assets with a fair value of $122,000 and a book value of $93,000 and liabilities with a book value and fair value of $22,000. Required: Compute the following amounts if Parade Corporation acquires 75 percent ownership of Summer: a. What amount did Parade pay for the shares if no goodwill and no gain on a bargain purchase are reported? Acquisition price b. What amount did Parade pay for the shares if the fair value of the noncontrolling interest at acquisition is $32,500 and goodwill of $30,000 is reported? Acquisition price c. What balance will be assigned to the noncontrolling interest in the consolidated balance sheet if Parade pays $97,500 to acquire its ownership and goodwill of $30,000 is reported? Balance assigned to noncontrolling interest
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Summer Company holds assets with a fair value of $122,000 and a book value of $93,000 and liabilities with a book value
and fair value of $22,000.
Required:
Compute the following amounts if Parade Corporation acquires 75 percent ownership of Summer:
a. What amount did Parade pay for the shares if no goodwill and no gain on a bargain purchase are reported?
Acquisition price
b. What amount did Parade pay for the shares if the fair value of the noncontrolling interest at acquisition is $32,500 and
goodwill of $30,000 is reported?
Acquisition price
c. What balance will be assigned to the noncontrolling interest in the consolidated balance sheet if Parade pays $97,500 to
acquire its ownership and goodwill of $30,000 is reported?
Balance assigned to noncontrolling interest
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