ACCOUNTING PRINCIPLES V1 6/17 >C<
3rd Edition
ISBN: 9781323761434
Author: Horngren
Publisher: PEARSON C
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Textbook Question
Chapter 10, Problem E10.26E
Measuring and recording
Learning Objective 5
1. Goodwill $1,000,000
Princeton has acquired several other companies. Assume that Princeton purchased Kelleher for $9,000,000 cash. The book value of Kelleher’s assets is $19,000,000 (market value, $20,000,000), and it has liabilities of $12,000,000 (market value, $12,000,000).
Requirements
- Compute the cost of the goodwill purchased by Princeton.
- Record the purchase of Kelleher by Princeton.
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Students have asked these similar questions
E10-18 Making a lump-sum puurchase of assets
Learning Objective 1
Lot 3 S108,750
Dearwood Properties bought three lots in a subdivision for a lump-sum price. An independent
appraiser valued the lots as follows:
Lot
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1
$ 45,000
2
292,500
3
112,500
Dearwood paid $435,000 in cash. Record the purchase in the journal, identifying each lot's
cost in a separate Land account. Round decimals to two places, and use the computed
percentages throughout.
COLLEGE
Question 4:
The following details regarding Machines are provided:
Machine Date of purchase Cost Date of sale Cash Proceeds
$
1,000,000 02/06/2020 450,000
XX
Y
05/04/2017
01/01/2019 2,000,000
The policy of the company is to depreciate its PP&E at 10% on cost. Depreciation is charged in full in the year of purchase
disposal.
Required:
For year ended 31st December 2020 prepare:
Machinery account
Accumulated depreciation account
Machinery disposal a/c
SPOL Extract
SFP Extract
Question 5:
A machine was purchased on 2nd July 2016 for $1,200,000. It was traded in for new one whose price was $1,000,000 on 2nd June
exchange. The policy of the company is to charge depreciation for its PP&E at 10% on cost per annum Depreciation is charged in
depreciation is charged in the year of disposal.
Measuring and recording goodwill
Princeton has acquired several other companies. Assume that Princeton purchased Kelleher for $9,000,000 cash. The book value of Kelleher’s assets is $19,000,000 (market value, $20,000,000), and it has liabilities of $12,000,000 (market value, $12,000,000).
Requirements
Compute the cost of the good-will purchased by Princeton.
Record the purchase of Kelleher by Princeton.
Chapter 10 Solutions
ACCOUNTING PRINCIPLES V1 6/17 >C<
Ch. 10 - Prob. 1QCCh. 10 - Prob. 2QCCh. 10 - Which method almost always produces the most...Ch. 10 - A Celty Airline jet costs $28,000,000 and expected...Ch. 10 - Prob. 5QCCh. 10 - Prob. 6QCCh. 10 - Prob. 7QCCh. 10 - Prob. 8QCCh. 10 - Prob. 9QCCh. 10 - Prob. 10AQC
Ch. 10 - Prob. 1RQCh. 10 - Plant assets are recorded at historical cost. What...Ch. 10 - Prob. 3RQCh. 10 - Prob. 4RQCh. 10 - Prob. 5RQCh. 10 - Prob. 6RQCh. 10 - What is depreciation? Define useful life, residual...Ch. 10 - Which depreciation method ignores residual value...Ch. 10 - How does a business decide which depreciation...Ch. 10 - What is the depreciation method that is used for a...Ch. 10 - If a business changes the estimated useful life or...Ch. 10 - Prob. 12RQCh. 10 - How is discarding of a plant asset different from...Ch. 10 - How is gain or loss determined when disposing of...Ch. 10 - Prob. 15RQCh. 10 - Prob. 16RQCh. 10 - Prob. 17RQCh. 10 - Prob. 18RQCh. 10 - Prob. 19RQCh. 10 - What does it mean if an exchange of plant assets...Ch. 10 - Determining the cost of an asset Learning...Ch. 10 - Making a lump-sum asset purchase Learning...Ch. 10 - Prob. S10.3SECh. 10 - Prob. S10.4SECh. 10 - Prob. S10.5SECh. 10 - Prob. S10.6SECh. 10 - Prob. S10.7SECh. 10 - Prob. S10.8SECh. 10 - Prob. S10.9SECh. 10 - Prob. S10.10SECh. 10 - Prob. S10.11SECh. 10 - Prob. S10.12SECh. 10 - Prob. S10.13SECh. 10 - Prob. S10.14SECh. 10 - Prob. S10A.15SECh. 10 - Prob. S10A.16SECh. 10 - Prob. E10.17ECh. 10 - Making a lump-sum purchase of assets Learning...Ch. 10 - Prob. E10.19ECh. 10 - Computing depreciationthree methods Learning...Ch. 10 - Prob. E10.21ECh. 10 - Prob. E10.22ECh. 10 - E10-23 Recoding partial-year depreciation and sale...Ch. 10 - Prob. E10.24ECh. 10 - Prob. E10.25ECh. 10 - Measuring and recording goodwill Learning...Ch. 10 - Computing asset turnover ratio Learning Objective...Ch. 10 - Prob. E10.28AECh. 10 - Prob. E10.29AECh. 10 - Determining asset cost and recoding partial-year...Ch. 10 - Determining asset cost, preparing depreciation...Ch. 10 - Prob. P10.32APGACh. 10 - Prob. P10.33APGACh. 10 - Prob. P10.34APGACh. 10 - Prob. P10A.35APGACh. 10 - Determining asset cost and recording partial-year...Ch. 10 - Prob. P10.37BPGBCh. 10 - P10-38B Recording lump-sum asset purchases,...Ch. 10 - Prob. P10.39BPGBCh. 10 - Prob. P10.40BPGBCh. 10 - Prob. P10A.41BPGBCh. 10 - P10-42 Using Excel to prepare depreciation...Ch. 10 - Prob. P10.43CPCh. 10 - Comprehensive Problem for Chapters 8, 9, and 10...Ch. 10 - Comprehensive Problem for Chapters 8, 9, and 10...Ch. 10 - Prob. 3CPCh. 10 - Prob. 4CPCh. 10 - Prob. 5CPCh. 10 - Prob. 6CPCh. 10 - Prob. 7CPCh. 10 - Prob. 8CPCh. 10 - McDonald’s Corporation is the world’s leading...Ch. 10 - Prob. 10.1EICh. 10 - Prob. 10.1FCCh. 10 - Prob. 10.1FSC
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