Soft Bound Version for Advanced Accounting 13th Edition
13th Edition
ISBN: 9781260110579
Author: Hoyle
Publisher: McGraw Hill Education
expand_more
expand_more
format_list_bulleted
Concept explainers
Question
Chapter 6, Problem 32P
To determine
Compute the amount attributed to
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Hepner Corporation has the following stockholders’ equity accounts:
Preferred stock (8% cumulative dividend)
$
660,000
Common stock
910,000
Additional paid-in capital
460,000
Retained earnings
1,110,000
The preferred stock is participating. Wasatch Corporation buys 70 percent of this common stock for $1,820,000 and 60 percent of the preferred stock for $810,000. The acquisition-date fair value of the noncontrolling interest in the common shares was $780,000 and was $540,000 for the preferred shares. All of the subsidiary’s assets and liabilities are viewed as having fair values equal to their book values.
What amount is attributed to goodwill on the date of acquisition?
Goodwill:
Presented below are two independent situations.
(1) Grand Cosmetics acquired 10% of the 200,000 ordinary shares of Cey Fashion at a total
cost of $12 per share on March 18, 2020. On June 30, Cey declared and paid a $60,000
dividend. On December 31, Cey reported net income of $110,000 for the year. At
December 31, the market price of Cey Fashion was $15 per share. The shares are classified
as non-trading.
(2) Unruh, Inc. obtained significant influence over Olsen Corporation by buying 25% of
Olsen's 40,000 outstanding ordinary shares at a total cost of $7 per share on January 1.
2020. On June 15, Olsen declared and paid a cash dividend of $30,000. On December 31.
Olsen reported a net income of SS0.000 for the year.
Instructions
Prepare all the necessary journal entries for 2020 for (a) Grand Cosmetics and (b) Unruh, Inc
Domestic
Chapter 6 Solutions
Soft Bound Version for Advanced Accounting 13th Edition
Ch. 6 - Prob. 1QCh. 6 - Prob. 2QCh. 6 - When is a firm required to consolidate the...Ch. 6 - Prob. 4QCh. 6 - Prob. 5QCh. 6 - Prob. 6QCh. 6 - Prob. 7QCh. 6 - Prob. 8QCh. 6 - Prob. 9QCh. 6 - Prob. 10Q
Ch. 6 - Prob. 11QCh. 6 - How do noncontrolling interest balances affect the...Ch. 6 - Prob. 13QCh. 6 - Prob. 14QCh. 6 - Prob. 15QCh. 6 - Prob. 16QCh. 6 - Prob. 17QCh. 6 - Prob. 1PCh. 6 - Prob. 2PCh. 6 - Prob. 3PCh. 6 - Prob. 4PCh. 6 - Prob. 5PCh. 6 - Prob. 6PCh. 6 - Problems 7 and 8 are based on the following...Ch. 6 - Prob. 8PCh. 6 - Bens man Corporation is computing EPS. One of its...Ch. 6 - Prob. 10PCh. 6 - Prob. 11PCh. 6 - Prob. 12PCh. 6 - Prob. 13PCh. 6 - Prob. 14PCh. 6 - Prob. 15PCh. 6 - Prob. 16PCh. 6 - On January 1, Coldwater Company has a net book...Ch. 6 - Prob. 18PCh. 6 - Prob. 19PCh. 6 - Prob. 20PCh. 6 - On January 1, 2018, Stamford issues 10,000...Ch. 6 - On January 1, 2018, Stamford reacquires 8,000 of...Ch. 6 - Prob. 23PCh. 6 - Prob. 24PCh. 6 - On December 31, 2017. PanTech Company invests...Ch. 6 - Prob. 26PCh. 6 - Prob. 27PCh. 6 - Prob. 28PCh. 6 - Prob. 29PCh. 6 - Prob. 30PCh. 6 - Prob. 31PCh. 6 - Prob. 32PCh. 6 - Prob. 33PCh. 6 - Prob. 34PCh. 6 - Prob. 35PCh. 6 - Alford Company and its 80 percentowned subsidiary,...Ch. 6 - Prob. 37PCh. 6 - Prob. 38PCh. 6 - Prob. 39PCh. 6 - Prob. 40PCh. 6 - Prob. 41PCh. 6 - Prob. 42PCh. 6 - Prob. 43PCh. 6 - Prob. 44PCh. 6 - Fred, Inc., and Herman Corporation formed a...Ch. 6 - Prob. 46PCh. 6 - Prob. 47PCh. 6 - Prob. 48PCh. 6 - Prob. 49PCh. 6 - Prob. 50PCh. 6 - Prob. 1DYSCh. 6 - Prob. 2DYSCh. 6 - The FASB ASC Subtopic Variable Interest Entities...
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Ames Corporation repurchases 10,000 shares of its common stock for $12 per share. The shares were originally issued at an average price of $10 per share. Later it resells 6,000 of the shares for $15 per share and the remaining 4,000 shares for $17 per share. How much gain or loss should Ames report on its income statement as a result of these transactions? $38.000 gain $0 $20,000 loss $20,000 loss and $38,000 gainarrow_forwardSUKON Company acquired equity securities at the beginning of 2020. SUKON Company provided you the following information: Security. No. of shares Acquisition Cost AKO Co. shares 100,000 shares P5,250,000 AKO shares were acquired and were designated as financial asset at fair value through OCI. The shares were acquired at P52.50 per share which included a P2.50 per share transaction cost. Half of the AKO shares were sold at P58 per share on July 1, 2021. Fair value, Fair value, Dec. 31, 2020 Dec. 31, 2021 P55/share P62/share How much is the carrying value of the Investment on December 31, 2021? O 2,900,000 O 2,500,000 O 3,100,000 O 2,750,000arrow_forwardPlease help me to solve this problemarrow_forward
- Dengerarrow_forwardCleveland Corporation is interested in acquiring Lewis Tool Company by swapping 0.4 share of its stock for each share of Lewis stock. Certain financial data on these companies are given in the following table. Item Cleveland Corporation Lewis Tool Earnings available for common stock $200,000 $50,000 Number of shares of common stock outstanding 50,000 20,000 Earnings per share (EPS) $4.00 $2.50 Market price per share $50.00 $15.00 Price/earnings (P/E) ratio 12.5 6 Cleveland has sufficient authorized but unissued shares to carry out the proposed merger. How many new shares of stock will Cleveland have to issue to make the proposed merger? If the earnings for each firm remain unchanged, what will the post-merger earnings per share be? How much, effectively, has been earned on behalf of each of the original shares of Lewis stock? How much, effectively, has been earned on behalf of each of the original shares of Cleveland Corporation’s stock?arrow_forwardOn January 1, 20x1 Pinup Corp acquired 34,560 outstanding ordinary shares of Slug corp. for a cash consideration pf P5,158,400. The shareholder’s equity of Slug Corp. on the date of business combination is presented below: Ordinary shares P100 par value 5,760,000 Share premium 1,600,000 Retained Earnings 960,000 Pinup Corp agreed to issue additional 1,000 shares to former owners of Slug Corp if the market price per share of Pinup Corp shares increase to P120 pe share. On the acquisition date, the contingent consideration was estimated at P80,000. What is the amount of non-controlling interest if it is measured at its proportionate share in the identifiable net assets of Slug Corp? 3,328,000 3,492,267 4,992,000 3,200,000arrow_forward
- Please help mearrow_forwardBaur Company acquired 20,000 ordinary shares on October 1 for P1,344,000 to be held for trading. On November 30, the investee distributed a 12% ordinary share dividend when the market price of the share was P65. On December 31, the entity sold 5,000 shares for P350,000. What amount should be reported as gain on sale of trading securities in the current year? *arrow_forwardAt the beginning of the current year ACME, Inc. has two shareholders: Shareholder 1 owns 60% of the stock and Shareholder 2 40%. Shareholder 1 has a basis in their stock of $200,000 and Shareholder 2 has basis of $150,000. The shareholders are not related to one another. ACME’s Current E&P for the year is $500,000. During the year ACME makes the following stock redemptions: Redemption 1: Purchases 10% of each of the shareholders shares for a total of $100,000 (split equally). Shareholder 1’s basis in the stock sold was $20,000 and shareholder 2 is $10,000. Redemption 2: Purchase all of shareholder 2’s remaining shares for $150,000. Required: How much does shareholder 2 include in their income for the year as a result of the two redemptions?arrow_forward
- Company A has agreed to buy Company B for $48.00/share in stock. Company A and Company B's stock prices on the day before announcement were $112.00 and $42.00 respectively. Company B has 20 million shares outstanding, 12 million exercisable options outstanding with an average exercise price of $28.00 per share, $120 million in net debt to be assumed by Company A and minority interests of $25 million to be acquired for cash. O 17.32 15.75 O 19.65 Company B Income Statement Items Calculate the equity to net income multiple. 20.00 LTM Revenue LTM EBITDA LTM Net Income $1000 million 95 million 60 millionarrow_forwardCompany A has agreed to buy Company B for $48.00/share in stock. Company A and Company B's stock prices on the day before announcement were $112.00 and $42.00 respectively. Company B has 20 million shares outstanding, 12 million exercisable options outstanding with an average exercise price of $28.00 per share, $120 million in net debt to be assumed by Company A and minority interests of $25 million to be acquired for cash. 1.345 O 1.185 LTM Net Income Calculate the enterprise to revenue multiple. O 0.9575 Company B Income Statement Items O 1.275 LTM Revenue LTM EBITDA $1000 million 95 million 60 millionarrow_forwardOn January 6, 20Y8, Bulldog Co. purchased 28% of the outstanding common stock of Gator Co. for $245,700. Gator Co. paid total dividends of $28,900 to all NKSHEET.AL... shareholders on June 30, 20Y8. Gator had a net loss of $56,500 for 20Y8. SO Required: GO a. Journalize Bulldog's purchase of the stock, receipt of the dividends, and the adjusting entry for the equity loss in Gator Co. stock. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal GO page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered. b. Compute the balance of Investment in Gator Co. Stock on December 31, 20Y8. LANKSHEET.AL... c. How does valuing an investment under the equity method differ from valuing an investment at fair value? Chart of Accounts CHART OF ACCOUNTS Bulldog Co. General Ledger REVENUE ASSETS 410 Sales 110 Cash 611 444 Dntti Cacharrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Cornerstones of Financial AccountingAccountingISBN:9781337690881Author:Jay Rich, Jeff JonesPublisher:Cengage Learning
Intermediate Accounting: Reporting And AnalysisAccountingISBN:9781337788281Author:James M. Wahlen, Jefferson P. Jones, Donald PagachPublisher:Cengage Learning
Cornerstones of Financial Accounting
Accounting
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Cengage Learning
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:Cengage Learning