Advanced Accounting
14th Edition
ISBN: 9781260247824
Author: Joe Ben Hoyle, Thomas F. Schaefer, Timothy S. Doupnik
Publisher: RENT MCG
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Chapter 2, Problem 25P
To determine
Determine the value that would be shown in Company P’s consolidated financial statements for each of the accounts listed:
| Accounts | |
| Inventory | Revenues |
| Land | Additional paid-in capital |
| Buildings and equipment | Expenses |
| Franchise agreements | |
| Retained earnings, 12/31 | |
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Following are preacquisition financial balances for Padre Company and Sol Company as of December 31. Also included are fair values for Sol Company accounts.On December 31, Padre acquires Sol’s outstanding stock by paying $360,000 in cash and issuing 10,000 shares of its own common stock with a fair value of $40 per share. Padre paid legal and accounting fees of $20,000 as well as $5,000 in stock issuance costs.Determine the value that would be shown in Padre’s consolidated financial statements for each of the accounts listed.
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(a)
(b)
(c)
Account Titles and Explanation
Debit
Credit
The condensed financial statements for Aylmer Inc and London Co for the year ended December 31, Year 5, are as follows:
On December 31, Year 5, after the above figures were prepared, Aylmer issued $375,000 in debt and 13,000 new shares to the owners of London for 75% of the outstanding shares of that company. Aylmer shares had a fair value of $36.50 per share.
Aylmer paid $26,590 to a broker for arranging the transaction. In addition, Aylmer paid $41,668 in stock issuance costs.
Required:
1. Using the fair value enterprise method, what are the consolidated balances for the year ended December 31, Year 5, for the following accounts?
(a)
Cash
(b)
Retained earnings, 1/1/Year 5
(c)
Equipment
(d)
Patented technology
(e)
Goodwill
(f)
Liabilities
(g)
Common shares
(h)
Non-controlling interests
2. Using the identifiable net assets method, what are the consolidated balances for the year ended December…
Chapter 2 Solutions
Advanced Accounting
Ch. 2 - Prob. 1QCh. 2 - Describe the concept of a synergy. What are some...Ch. 2 - Prob. 3QCh. 2 - What does the term consolidated financial...Ch. 2 - Within the consolidation process, what is the...Ch. 2 - Prob. 6QCh. 2 - Prob. 7QCh. 2 - Prob. 8QCh. 2 - Prob. 9QCh. 2 - Prob. 10Q
Ch. 2 - Prob. 11QCh. 2 - Prob. 12QCh. 2 - Which of the following does not represent a...Ch. 2 - Prob. 2PCh. 2 - Prob. 3PCh. 2 - Prob. 4PCh. 2 - Prob. 5PCh. 2 - Prob. 6PCh. 2 - Prob. 7PCh. 2 - When does gain recognition accompany a business...Ch. 2 - Prob. 9PCh. 2 - Prob. 10PCh. 2 - Prob. 11PCh. 2 - On June 1, Cline Co. paid 800,000 cash for all of...Ch. 2 - On May 1, Donovan Company reported the following...Ch. 2 - Prob. 14PCh. 2 - Prob. 15PCh. 2 - Prob. 16PCh. 2 - Prob. 17PCh. 2 - On its acquisition-date consolidated balance...Ch. 2 - On its acquisition-date consolidated balance...Ch. 2 - Prob. 20PCh. 2 - Prob. 21PCh. 2 - Prob. 22PCh. 2 - The following book and fair values were available...Ch. 2 - Prob. 24PCh. 2 - Prob. 25PCh. 2 - Prob. 26PCh. 2 - Prob. 27PCh. 2 - Prob. 28PCh. 2 - SafeData Corporation has the following account...Ch. 2 - Prob. 34PCh. 2 - Prob. 35PCh. 2 - Prob. 39APBCh. 2 - Prob. 40APB
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