Summer Company holds assets with a fair value of $126,000 and a book value of $95,000 and liabilities with a book value and fair value of $24,000. Required: Compute the following amounts if Parade Corporation acquires 70 percent ownership of Summer: What amount did Parade pay for the shares if no goodwill and no gain on a bargain purchase are reported? What amount did Parade pay for the shares if the fair value of the noncontrolling interest at acquisition is $45,600 and goodwill of $50,000 is reported? What balance will be assigned to the noncontrolling interest in the consolidated balance sheet if Parade pays $87,500 to acquire its ownership and goodwill of $23,000 is reported?
Summer Company holds assets with a fair value of $126,000 and a book value of $95,000 and liabilities with a book value and fair value of $24,000. Required: Compute the following amounts if Parade Corporation acquires 70 percent ownership of Summer: What amount did Parade pay for the shares if no goodwill and no gain on a bargain purchase are reported? What amount did Parade pay for the shares if the fair value of the noncontrolling interest at acquisition is $45,600 and goodwill of $50,000 is reported? What balance will be assigned to the noncontrolling interest in the consolidated balance sheet if Parade pays $87,500 to acquire its ownership and goodwill of $23,000 is reported?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Summer Company holds assets with a fair value of $126,000 and a book value of $95,000 and liabilities with a book value and fair value of $24,000.
Required:
Compute the following amounts if Parade Corporation acquires 70 percent ownership of Summer:
- What amount did Parade pay for the shares if no
goodwill and no gain on a bargain purchase are reported? - What amount did Parade pay for the shares if the fair value of the noncontrolling interest at acquisition is $45,600 and goodwill of $50,000 is reported?
- What balance will be assigned to the noncontrolling interest in the consolidated
balance sheet if Parade pays $87,500 to acquire its ownership and goodwill of $23,000 is reported?
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