Question

12. Ejercicio #2. Favor de responder en el espacio provisto. Son Exercise 2: Prepare balance sheet after acquisition Comparative balance sheets for Pop and Son Corporations at December 31, 2015, are as follows: Pop Current assets $2,080,000 $960,000 Land 800,000 1,600,000 Buildings-net 4,800,000 1,600,000 Equipment-net 3,520,000 3,840,000 Total assets $11,200,000 $8,000,000 Current liabilities $800,000 $960,000 Capital stock, $10 par 8,000,000 3,200,000 Additional paid-in capital 800,000 2,240,000 Retained earnings 1,600,000 1,600,000 Total equities $11,200,000 $8,000,000 On January 2, 2016, Pop issues 240,000 shares of its stock with a market value of $40 per share for all the outstanding shares of Son Corporation in an acquisition. Son is dissolved. The recorded book values reflect fair values, except for the buildings of Pop, which have a fair value of $6,4000,000, and the current assets of Son, which have a fair value of $1,600,000. Pop pays the following expenses in connection with the business combination: Cost of registering and issuing securities $240,000 (Direct Cost) Other direct costs of combination $400,000 Tu respuesta

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Answer-12

Answer: POP CORPORATION Balance Sheet at January 2, 2016 in thousands) Assets Current Assets (2080+960+640-640) Land (800+1600) Building - Net (4800+1600) Equipment - Net (3520+3840) Goodwill Total Assets 3040 2400 6400 7360 1920 21120 Liabilities and Stockholders Equity Current liability (800+960) 1760 Capital Stack $10 par (8000+2400) 10400 Additional paid in capital (800+(40- 7760 10)*240-240) Retained Earnings (1600-400) 1200 Total Liabilities and Stockholders equity 21120
Note 2:- Each calculation are in thousand.