Flynn acquires 100 percent of the outstanding voting shares of Macek Company on January 1, 2018. To obtain these shares, Flynn pays $400 cash (in thousands) and issues 10,000 shares of $20 par value c...
Flynn acquires 100 percent of the outstanding voting shares of Macek Company on January 1, 2018. To obtain these shares, Flynn pays $400 cash (in thousands) and issues 10,000 shares of $20 par value common stock on this date. Flynn's stock had a fair value of $36 per share on that date. Flynn also pays $15 (in thousands) to a local investment firm for arranging the acquisition. An additional $10 (in thousands) was paid by Flynn in stock issuance costs. The book values for both Flynn and Macek as of January 1, 2018 follow. The fair value of each of Flynn and Macek accounts is also included. In addition, Macek holds a fully amortized trademark that still retains a $40 (in thousands) value. The figures below are in thousands. Any related question also is in thousands. Flynn, Inc Macek Company Book Value Fair Value Cash $ 900 $ 80 $ 80 Receivables 480 180 160 Inventory 660 260 300 Land 300 120 130 Buildings (net) 1,200 220 280 Equipment 360 100 75 Accounts payable 480 60 60 Long-term liabilities 1,140 340 300 Common stock 1,000 80 Additional paid-in capital 200 0 Retained earnings 1,080 480 MC Qu. 89 Under the acquisition method... Under the acquisition method, what amount will be reported for consolidated retained earnings? Multiple Choice $1,065,000. $1,080,000. $1,525,000. $1,535,000. $1,560,000.
Flynn acquires 100 percent of the outstanding voting shares of Macek Company on January 1, 2018. To obtain these shares, Flynn pays $400 cash (in thousands) and issues 10,000 shares of $20 par value common stock on this date. Flynn's stock had a fair value of $36 per share on that date. Flynn also pays $15 (in thousands) to a local investment firm for arranging the acquisition. An additional $10 (in thousands) was paid by Flynn in stock issuance costs.
The book values for both Flynn and Macek as of January 1, 2018 follow. The fair value of each of Flynn and Macek accounts is also included. In addition, Macek holds a fully amortized trademark that still retains a $40 (in thousands) value. The figures below are in thousands. Any related question also is in thousands.
| Flynn, Inc | Macek Company | ||||||||||
| Book Value | Fair Value | ||||||||||
| Cash | $ | 900 | $ | 80 | $ | 80 | |||||
| Receivables | 480 | 180 | 160 | ||||||||
| Inventory | 660 | 260 | 300 | ||||||||
| Land | 300 | 120 | 130 | ||||||||
| Buildings (net) | 1,200 | 220 | 280 | ||||||||
| Equipment | 360 | 100 | 75 | ||||||||
| Accounts payable | 480 | 60 | 60 | ||||||||
| Long-term liabilities | 1,140 | 340 | 300 | ||||||||
| Common stock | 1,000 | 80 | |||||||||
| Additional paid-in capital | 200 | 0 | |||||||||
| Retained earnings | 1,080 | 480 | |||||||||
MC Qu. 91 What amount will be reported...
What amount will be reported for consolidated cash after the acquisition is completed?
Multiple Choice
-
$475,000.
-
$500,000.
-
$555,000.
-
$580,000.
-
$875,000.
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Flynn acquires 100 percent of the outstanding voting shares of Macek Company on January 1, 2018. To obtain these shares, Flynn pays $400 cash (in thousands) and issues 10,000 shares of $20 par value c...
Please help! I'm very confused :( A. Assuming the combination occurred prior to 2009 and was acc...
Please help! I'm very confused :(
A. Assuming the combination occurred prior to 2009 and was
accounted for under the purchase method, what amount will be
reported for consolidated retained earnings?
B. Under the acquisition method, what amount will be reported
for consolidated retained earnings?
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Please help! I'm very confused :(
A. Assuming the combination occurred prior to 2009 and was
accounted for under the purchase method, what amount will be
reported for consolidated retained earnings?
B. Under the acquisition method, what amount will be reported
for consolidated retained earnings?
Required information Flynn acquires 100 percent of the outstanding voting shares of Macek Company on January 1, 2018. To obtain these shares, Flynn pays $400 cash (in thousands) and issues 10,000 shares of $20 par...
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