Advanced Accounting (Looseleaf)
12th Edition
ISBN: 9780077632595
Author: Hoyle
Publisher: MCG
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Chapter 4, Problem 14P
To determine
Identify the appropriate answer for the given statement from the given choices.
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Use the following information for Problems 14 through 16:West Company acquired 60 percent of Solar Company for $300,000 when Solar’s book value was $400,000. The newly comprised 40 percent noncontrolling interest had an assessed fair value of $200,000. Also at the acquisition date, Solar had a trademark (with a 10-year remaining life) that was undervalued in the financial records by $60,000. Also, patented technology (with a 5-year remaining life) was undervalued by $40,000. Two years later, the following figures are reported by these two companies (stockholders’ equity accounts have been omitted):What is the consolidated trademarks balance?a. $508,000b. $514,000c. $520,000d. $540,000
Use the following information for Problems 14 through 16:West Company acquired 60 percent of Solar Company for $300,000 when Solar’s book value was $400,000. The newly comprised 40 percent noncontrolling interest had an assessed fair value of $200,000. Also at the acquisition date, Solar had a trademark (with a 10-year remaining life) that was undervalued in the financial records by $60,000. Also, patented technology (with a 5-year remaining life) was undervalued by $40,000. Two years later, the following figures are reported by these two companies (stockholders’ equity accounts have been omitted):Assuming Solar Company has declared no dividends, what are the noncontrolling interest’s share of the subsidiary’s income and the ending balance of the noncontrolling interest in the subsidiary?a. $26,000 and $230,000b. $28,800 and $252,000c. $34,400 and $240,800d. $40,000 and $252,000
On January 1, 2023, French Company acquired 60 percent of K-Tech Company for $342,000 when K-Tech's book value was
$442,000. The fair value of the newly comprised 40 percent noncontrolling interest was assessed at $228,000. At the acquisition
date, K-Tech's trademark (10-year remaining life) was undervalued in its financial records by $80,000. Also, patented technology (5-
year remaining life) was undervalued by $48,000.
In 2023, K-Tech reports $8,000 net income and declares no dividends. At the end of 2024, the two companies report the following
figures (stockholders' equity accounts have been omitted):
Items
Current assets
Trademarks
Patented technology
Liabilities
French Company
Carrying Amounts
$ 644,000
284,000
434,000
(414,000)
K-Tech Company
Carrying
Amounts
$ 324,000
224,000
174,000
K-Tech Company
Fair Values
$ 344,000
304,000
222,000
(144,000)
Revenues
Expenses
Investment income
(144,000)
(924,000)
(424,000)
476,000
324,000
Not given
0
Note: Parentheses indicate a credit…
Chapter 4 Solutions
Advanced Accounting (Looseleaf)
Ch. 4 - Prob. 1QCh. 4 - Atwater Company acquires 80 percent of the...Ch. 4 - What is a control premium and how does it affect...Ch. 4 - Prob. 4QCh. 4 - How is the noncontrolling interest in a subsidiary...Ch. 4 - Prob. 6QCh. 4 - Prob. 7QCh. 4 - Prob. 8QCh. 4 - Prob. 9QCh. 4 - Prob. 10Q
Ch. 4 - Prob. 1PCh. 4 - Prob. 2PCh. 4 - Prob. 3PCh. 4 - Prob. 4PCh. 4 - Prob. 5PCh. 4 - Prob. 6PCh. 4 - Prob. 7PCh. 4 - Prob. 8PCh. 4 - Prob. 9PCh. 4 - Prob. 10PCh. 4 - Prob. 11PCh. 4 - Prob. 12PCh. 4 - Prob. 13PCh. 4 - Prob. 14PCh. 4 - Prob. 15PCh. 4 - Prob. 16PCh. 4 - Prob. 17PCh. 4 - Prob. 18PCh. 4 - Current liabilities: a. 50,000 b. 46,000 c. 40,000...Ch. 4 - Prob. 20PCh. 4 - Stockholders equity: a. 80,000 b. 90,000 c. 95,000...Ch. 4 - Prob. 22PCh. 4 - Prob. 23PCh. 4 - Prob. 24PCh. 4 - Prob. 25PCh. 4 - Prob. 26PCh. 4 - Prob. 27PCh. 4 - Prob. 28PCh. 4 - Prob. 29PCh. 4 - Prob. 30PCh. 4 - Prob. 31PCh. 4 - Prob. 32PCh. 4 - Prob. 33PCh. 4 - Prob. 34PCh. 4 - Prob. 35PCh. 4 - Prob. 36PCh. 4 - Prob. 37PCh. 4 - Prob. 38PCh. 4 - Prob. 39PCh. 4 - Prob. 40PCh. 4 - Prob. 41PCh. 4 - Prob. 42PCh. 4 - Prob. 1DYS
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- On January 1, 2023, French Company acquired 60 percent of K-Tech Company for $319,500 when K-Tech's book value was $419,500. The fair value of the newly comprised 40 percent noncontrolling interest was assessed at $213,000. At the acquisition date, K-Tech's trademark (10-year remaining life) was undervalued in its financial records by $80,000. Also, patented technology (5-year remaining life) was undervalued by $33,000. In 2023, K-Tech reports $19,500 net income and declares no dividends. At the end of 2024, the two companies report the following figures (stockholders' equity accounts have been omitted): Items Current assets Trademarks Patented technology Liabilities Revenues French Company Carrying Amounts $ 631,000 271,000 421,000 (401,000) K-Tech Company Carrying Amounts $ 311,000 211,000 161,000 K-Tech Company Fair Values $ 331,000 291,000 194,000 (131,000) 0 (131,000) (911,000) (411,000) Expenses 489,000 311,000 Investment income Not given 0 Note: Parentheses indicate a credit…arrow_forwardOn January 1, 2023, French Company acquired 60 percent of K-Tech Company for $300,000 when K-Tech’s book value was $400,000. The fair value of the newly comprised 40 percent noncontrolling interest was assessed at $200,000. At the acquisition date, K-Tech's trademark (10-year remaining life) was undervalued in its financial records by $60,000. Also, patented technology (5-year remaining life) was undervalued by $40,000. In 2023, K-Tech reports $30,000 net income and declares no dividends. At the end of 2024, the two companies report the following figures (stockholders’ equity accounts have been omitted): Items French Company Carrying Amounts K-Tech Company Carrying Amounts K-Tech Company Fair Values Current assets $ 620,000 $ 300,000 $ 320,000 Trademarks 260,000 200,000 280,000 Patented technology 410,000 150,000 190,000 Liabilities (390,000) (120,000) (120,000) Revenues (900,000) (400,000) 0 Expenses 500,000 300,000 0 Investment income Not given 0 0 Note:…arrow_forwardOn January 1, 2023, French Company acquired 60 percent of K-Tech Company for $306,000 when K-Tech's book value was $406,000. The fair value of the newly comprised 40 percent noncontrolling interest was assessed at $204,000. At the acquisition date, K-Tech's trademark (10-year remaining life) was undervalued in its financial records by $80,000. Also, patented technology (5- year remaining life) was undervalued by $24,000. In 2023, K-Tech reports $28,000 net income and declares no dividends. At the end of 2024, the two companies report the following figures (stockholders' equity accounts have been omitted): Itens Current assets Trademarks Patented technology Liabilities Revenues Expenses Investment income French Company Carrying Amounts $ 624,000 264,000 414,000 (394,000) (904,000) 496,000 Not given K-Tech Company Carrying Amounts $ 304,000 204,000 154,000 (124,000) (404,000) 304,000 K-Tech Company Fair Values $ 324,000 284,000 178,000 (124,000) Note: Parentheses indicate a credit…arrow_forward
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