INTANGIBLE ASSETS - Problem 3a. Black Mirror, Inc. purchased another company Stranger Things, Corp. in its entirety for $165million in cash (i.e., this is an M&A). Below is a list of the assets and liabilities thatStranger Things has (book values refer to how they appeared on Stranger Things' Balance Sheetbefore the acquisition, while fair values are determined in independent evaluation).Stranger Things Assets and Liabilities:● Accounts Receivable:● PP&EGoodwill from prior acquisitions• Copyrights (internally developed)Accounts Payable● Deferred Tax LiabilityAmountAssetsBook Value3530*45* BV of PP&E is comprised of Gross PP&E of 50 minus Accumulated Depreciation of 20What assets does BlackMirror, Inc. add to its Balance Sheet as a result of this M&AAsset NameAmount1816What liabilities does BlackMirror, Inc. add to its Balance Sheet as a result of this M&ALiability Name= Liabilities + EquityFair Value3035701812b. A year later Black Mirror, Inc. values its Stranger Things related goodwill asset to be $20.What, if any, are the financial statement effects of this valuation?SalesExpenses=Profit

The acquisition is the method through which one of the company which acquirers another company gets…

What assets does Black Mirror, Inc. add to its Balance Sheet as a result of this M&A Asset Name Amount What liabilities does Black Mirror, Inc. add to its Balance Sheet as a result of this M&A Liability Name Amount b. A year later Black Mirror, Inc. values its Stranger Things related goodwill asset to be $20. What, if any, are the financial statement effects of this valuation?

What assets does Black Mirror, Inc. add to its Balance Sheet as a result of this M&A Asset Name Amount What liabilities does Black Mirror, Inc. add to its Balance Sheet as a result of this M&A Liability Name Amount b. A year later Black Mirror, Inc. values its Stranger Things related goodwill asset to be $20. What, if any, are the financial statement effects of this valuation?

FINANCIAL ACCOUNTING

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ISBN:9781259964947

Author:Libby

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Chapter1: Financial Statements And Business Decisions

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Question

INTANGIBLE ASSETS - Problem 3
a. Black Mirror, Inc. purchased another company Stranger Things, Corp. in its entirety for $165
million in cash (i.e., this is an M&A). Below is a list of the assets and liabilities that
Stranger Things has (book values refer to how they appeared on Stranger Things' Balance Sheet
before the acquisition, while fair values are determined in independent evaluation).
Stranger Things Assets and Liabilities:
● Accounts Receivable:
● PP&E
Goodwill from prior acquisitions
• Copyrights (internally developed)
Accounts Payable
● Deferred Tax Liability
Amount
Assets
Book Value
35
30*
45
* BV of PP&E is comprised of Gross PP&E of 50 minus Accumulated Depreciation of 20
What assets does BlackMirror, Inc. add to its Balance Sheet as a result of this M&A
Asset Name
Amount
18
16
What liabilities does BlackMirror, Inc. add to its Balance Sheet as a result of this M&A
Liability Name
= Liabilities + Equity
Fair Value
30
35
70
18
12
b. A year later Black Mirror, Inc. values its Stranger Things related goodwill asset to be $20.
What, if any, are the financial statement effects of this valuation?
Sales
Expenses
=
Profit

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