1.
Introduction:
A company whose majority stake is acquired by another company is called acquired company and the company that acquires the stake is called purchasing company.
We are discussing about the recent acquisition of Pret A Manger by JAB Holding Company from Bridgepoint.
Supplier means a party that supplies goods or services.
Customer means a person who buys goods or services from a shop or business.
Competitor means a business or organization that provides same or similar goods or services as that of another business or organization.
Unrelated company means a company that is not related to another company whether by way of common control or otherwise.
To Identify:
Whether Pret A Manger is a supplier, customer, competitor, or unrelated company relative to the purchasing company, JAB.
2.
Introduction:
In recent times business expansion has been the one of the biggest contributors to firms’ growth. One of the ways of business expansion is by acquiring stake in another company or by mergers and acquisitions.
To Analyze:
What objective the purchasing company (JAB) hopes to accomplish with the investment in Pret A Manger and what is its strategy.
Want to see the full answer?
Check out a sample textbook solutionChapter 15 Solutions
Connect Access Card for Fundamental Accounting Principles
- ??!!!arrow_forwardPlug Products owns 80 percent of the stock of Spark Filter Company, which it acquired at underlying book value on August 30, 20X6. At that date, the fair value of the noncontrolling interest was equal to 20 percent of the book value of Spark Filter. Summarized trial balance data for the two companies as of December 31, 20X8, are as follows: Plug Products Spark Filter Company Credit Debit Credit Debit Cash and Accounts Receivable $ 146,000 $ 95,000 Inventory 236,000 119,000 Buildings and Equipment (net) 288,000 187,000 Investment in Spark Filter Company 267,789 Cost of Goods Sold 172,000 137,000 Depreciation Expense 40,000 30,000 Current Liabilities $ 170,147 $ 53,947 Common Stock 192,000 73,000 Retained Earnings 460,000 216,000 Sales 275,053 225,053 Income from Spark Filter Company 52,589 Total $ 1,149,789 $ 1,149,789 $ 568,000 $ 568,000 On January 1, 20X8, Plug's inventory contained filters purchased…arrow_forwardGeneral Accountingarrow_forward
- AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
- Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSONIntermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill EducationFinancial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education