Homework Answers
Solution:
|
Value Analysis Schedule |
Company Implied FV |
Parent price (80%) |
NCI Value (20%) |
|
Company fair value |
492,000 |
400,000 |
92,000 |
|
Fair value of net assets excluding goodwill |
450,000 |
360,000 |
90,000 |
|
Goodwill |
42,000 |
40,000 |
2,000 |
Determination and Distribution of Excess Schedule:
|
Company Implied FV |
Parent price (80%) |
NCI Value (20%) |
|
|
Fair value of subsidiary |
492,000 |
400,000 |
92,000 |
|
Less book value of interest acquired: |
|||
|
Common stock ($1 par) |
10,000 |
||
|
Paid-in capital in excess of par |
90,000 |
||
|
Retained earnings |
60,000 |
||
|
Total equity |
160,000 |
160,000 |
160,000 |
|
Interest acquired |
80% |
20% |
|
|
Book value |
128,000 |
32,000 |
|
|
Excess of fair value over book value |
332,000 |
272,000 |
60,000 |
|
Adjustment of identifiable accounts: |
|
|
Inventory ($60,000 fair - $50,000 BV) |
10,000 |
|
Land ($80,000 fair - $40,000 BV) |
40,000 |
|
Buildings ($320,000 fair - $150,000 NBV). |
170,000 |
|
Equipment ($60,000 fair - $40,000 NBV) |
20,000 |
|
Copyright ($50,000 fair – $0 BV) |
50,000 |
|
Goodwill |
42,000 |
|
Total |
332,000 |
Add Answer to:
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The first page is the balance sheet and questions. The second page we are supposed to...
The
first page is the balance sheet and questions. The second page we
are supposed to fill in.
Venus Corporation purchases 70% of the common stock of Starnes Company for $700,000. At the time of purchase, Starnes has the following balance sheet: Starnes Company Balance Sheet December 31, 2019 90,000 300,000 Assets Cash equivalents Inventory Land Building (net) Equipment (net) Total Assets Liabilities and Equity 110,000 Accounts Payable 200,000 Bonds Payable 80,000 Stockholder's Equity 400,000 Common Stock ($5 par) 210,000...
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E5-5 Balance Sheet Worksheet Problem Company owns 90 percent of Solution Dairy's stock. The balance sheets of the two companies immediately after the Solution acquisition showed the following amounts: Problem Company Solution Dairy $ 70,000 90,000 40,000 220,000 Cash & Receivables Inventory Land Buildings & Equipment (net) Investment in Solution Dairy Total Assets Current Payables Long-Term Liabilities Common Stock Retained Earnings Total Liabilities & Stockholders' Equity $ 130,000 210,000 70,000 390,000 270,000 $1,070,000 $ 80,000 200,000 400,000 390,000 $1,070,000 $420,000...
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Parent Co paid $176,000 for 80% of the outstanding voting stock of Sub Co on January...
Parent Co paid $176,000 for 80% of the outstanding voting stock
of Sub Co on January 1, 2018, when Sub Co’s stockholders’ equity
consisted of $120,000 common stock and $60,000 retained earnings.
This implied that the total fair value of Sub co is $220,000
($176,000 / 80%). The company assigned the $40,000 excess fair
value to previously unrecorded patents with a 10-year useful
life.
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of Sub Co’s $50,000...
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Venus Corporation purchases 70% of the common stock of Starnes Company for $700,000. At the time of purchase, Starnes has the following balance sheet: Starnes Company Balance Sheet December 31, 2019 90,000 300,000 Assets Cash equivalents Inventory Land Building (net) Equipment (net) Total Assets Liabilities and Equity 110,000 Accounts Payable 200,000 Bonds Payable 80,000 Stockholder's Equity 400,000 Common Stock ($5 par) 210,000 Paid-in Capital in excess of par Retained Earnings 1,000,000 Total Liabilities and Equity 100,000 160,000 350,000 1,000,000 The...
On January 1, 20X9, Parker acquired 90% of Sanders for $200,000 plus $15,000 in acquisition costs. On the date of acquisition, Sanders had the following balance sheet Sanders Company Balance Sheet January 1, 20x9 Assets Liabilities and Equity Accounts Receivable $40,000 Current Liabilities $110,000 100,000 100,000 Inventory 160,000 Bonds Payable 60,000 Common Stock, $1 par 150,000 Paid-in Capital (20,000) Retained Earnings 50,000 (10,000) 30,000 $460,000 Total Liabilities and Equity Land Buildings Accumulated Depreciation Equipment Accumulated Depreciation Goodwill Total Assets 50,000...
A B D E Venus Corporation purchases 70% of the common stock of Starnes Company for $700,000. At the time of purchase, Starnes has the following balance sheet: Starnes Company Balance Sheet December 31, 2019 90,000 300,000 Assets Cash equivalents Inventory Land Building (net) Equipment (net) $ $ $ $ $ Liabilities and Equity 110,000 Accounts Payable $ 200,000 Bonds Payable $ 80,000 Stockholder's Equity 400,000 Common Stock ($5 par) $ 210,000 Paid-in Capital in excess of par $ Retained...
Venus Corporation purchases 70% of the common stock of Starnes Company for $700,000. At the time of purchase, Starnes has the following balance sheet: Starnes Company Balance Sheet December 31, 2019 90,000 300,000 Assets Cash equivalents Inventory Land Building (net) Equipment (net) Total Assets Liabilities and Equity 110,000 Accounts Payable 200,000 Bonds Payable 80,000 Stockholder's Equity 400,000 Common Stock ($5 par) 210,000 Paid-in Capital in excess of par Retained Earnings 1,000,000 Total Liabilities and Equity 100,000 160,000 350,000 1,000,000 The...
The
first page is the balance sheet and questions. The second page we
are supposed to fill in.
Venus Corporation purchases 70% of the common stock of Starnes Company for $700,000. At the time of purchase, Starnes has the following balance sheet: Starnes Company Balance Sheet December 31, 2019 90,000 300,000 Assets Cash equivalents Inventory Land Building (net) Equipment (net) Total Assets Liabilities and Equity 110,000 Accounts Payable 200,000 Bonds Payable 80,000 Stockholder's Equity 400,000 Common Stock ($5 par) 210,000...
E5-5 Balance Sheet Worksheet Problem Company owns 90 percent of Solution Dairy's stock. The balance sheets of the two companies immediately after the Solution acquisition showed the following amounts: Problem Company Solution Dairy $ 70,000 90,000 40,000 220,000 Cash & Receivables Inventory Land Buildings & Equipment (net) Investment in Solution Dairy Total Assets Current Payables Long-Term Liabilities Common Stock Retained Earnings Total Liabilities & Stockholders' Equity $ 130,000 210,000 70,000 390,000 270,000 $1,070,000 $ 80,000 200,000 400,000 390,000 $1,070,000 $420,000...
P4-25 Assignment of Differential in Worksheet LO 4-5 Pork Corporation acquired all the voting shares of Swine Enterprises on January 1, 20X4. Balance sheet amounts for the companies on the date of acquisition were as follows: Cash & Receivables Inventory Land Buildings & Equipment Investment in Swine Enterprises Total Debits Pork Corporation $ 56,000 101,000 84,000 416,000 297,000 $954,000 Swine Enterprises $ 36,000 56,000 94,000 240,000 $426,000 Accumulated Depreciation Accounts Payable Notes Payable Common Stock Retained Earnings Total Credits $160,000...
Parent Co paid $176,000 for 80% of the outstanding voting stock
of Sub Co on January 1, 2018, when Sub Co’s stockholders’ equity
consisted of $120,000 common stock and $60,000 retained earnings.
This implied that the total fair value of Sub co is $220,000
($176,000 / 80%). The company assigned the $40,000 excess fair
value to previously unrecorded patents with a 10-year useful
life.
Parent Co’s $36,800 income from Sub Co for 2018 consisted of 80%
of Sub Co’s $50,000...
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