Advanced Accounting (Looseleaf)
12th Edition
ISBN: 9780077632595
Author: Hoyle
Publisher: MCG
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Chapter 4, Problem 3P
To determine
Identify the appropriate answer for the given statement from the given choices.
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Brooks Company purchases debt investments as trading securities at a cost of $71,000 on December 27. This is its first and only purchase of such securities. At December 31, these securities had a fair value of $90,000. Brooks sells a portion of its trading securities (costing $35,500) for $40,250 cash. Analyze each transaction above by showing its effects on the accounting equation-specifically, identify the accounts and amounts (including + or -) for each transaction.
3. On April 1, 20X2, Pack Company paid $800,000 for all of Sack Corporation's issued and outstanding common stock Sack's recorded assets and liabilities on April 1, 20X2, were as follows:
$ 80,000
240,000
Cash
Inventory
Property and equipment (net of accumulated
depreciation of $320,000)
Liabilities
On April 1, 20X2, Sack's inventory was determined to have a fair value of $190.000, and the property and equipment had a fair value of $560.000. What is the amount of goodwill resulting from the
business combination?
Multiple Choice
$180.000.
$0.
$50,000
480,000
(180,000)
$150.000.
On January 1, 2XX1, Bargain Inc. acquired 100% of Wind Corporation for $9,750,000 cash. On that date,
Willey's total stockholders' equity was $7,250,000. The following assets had fair values different from
book values.
Book Value Fair Value
Buildings and Land $13,500,000 $14,500,000
Other Assets
Bonds Payable
625,000
250,000
7,500,000 6,250,000
Required
Prepare the [E] and [A] consolidation entries on the date of the acquisition:
[E]
Debit
Credit
[A]
V
(to record the [E] consolidation entry)
(to record the [A] consolidation entry)
Debit
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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