The following are the balance sheets of Entity A and Entity B as of June 30, 2021: Entity A Current Assets 500 Noncurrent Assets 1,300 Capital Stock - 100 Shares 300 Retained Earnings 800 Current Liabilities 300 Non Current Liabilities 400 Entity B Current Assets 700 Noncurrent Assets 3,000 Capital Stock - 60 shares 600 Retained Earnings 1,400 Current Liabilities 600 Non Current Liabilities 1,100 On July 1, 2021, A acquired all issued shares of B giving in exchange 2.50 A shares for each ordinary shares of B in order for B to obtain public listing. The fair value of each ordinary share of B at July 1, is 40., while the quoted market price of A's ordinary shares is 16. The fair values of A's identifiable net assets at acquisition date are the same of their carrying amounts, except for noncurrent assets whose fair value was 1,500. On the other hand, the fair value of the net assets of B are approximately their carrying amounts. Stockholder's equity in the consolidated balance sheet at July 1, 2021

The following are the balance sheets of Entity A and Entity B as of June 30, 2021: Entity A Current Assets 500 Noncurrent Assets 1,300 Capital Stock - 100 Shares 300 Retained Earnings 800 Current Liabilities 300 Non Current Liabilities 400 Entity B Current Assets 700 Noncurrent Assets 3,000 Capital Stock - 60 shares 600 Retained Earnings 1,400 Current Liabilities 600 Non Current Liabilities 1,100 On July 1, 2021, A acquired all issued shares of B giving in exchange 2.50 A shares for each ordinary shares of B in order for B to obtain public listing. The fair value of each ordinary share of B at July 1, is 40., while the quoted market price of A's ordinary shares is 16. The fair values of A's identifiable net assets at acquisition date are the same of their carrying amounts, except for noncurrent assets whose fair value was 1,500. On the other hand, the fair value of the net assets of B are approximately their carrying amounts. Stockholder's equity in the consolidated balance sheet at July 1, 2021

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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