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Estimating Goodwill and Valuation LO 7 Alpha Company is considering the purchase of Beta Company. Alpha...
Alpha Company is considering the purchase of Beta Company. Alpha has collected the following data about...
Alpha Company is considering the purchase of Beta Company. Alpha has collected the following data about Beta: Total Identifiable assets Total liabilities Owners' equity Beta Company Book Values $631,600 288,700 $342,900 Estimated Market Values $735,800 328,300 Cumulative total net cash earnings for the past five years of $927,700 Includes extraordinary cash gains of $69,800 and nonrecurring cash losses of $44,300. Alpha Company expects a retum on Its Investment of 13%. Assume that Alpha prefers to use cash earnings rather than...
Exercise 1-2 Alpha Company is considering the purchase of Beta Company. Alpha has collected the following...
Exercise 1-2 Alpha Company is considering the purchase of Beta Company. Alpha has collected the following data about Beta: Beta Company Estimated Book Values Market Values Total identifiable assets $541,800 $734,700 Total liabilities 317,800 309,500 Owners' equity $224,000 Cumulative total net cash earnings for the past five years of $906,800 includes extraordinary cash gains of $64,800 and nonrecurring cash losses of $46,000. Alpha Company expects a return on its investment of 13%. Assume that Alpha prefers to use cash earnings...
EXERCISE 1-1 Estimating Goodwill and Potential Offering Price LO 7 Plantation Homes Company is considering the...
EXERCISE 1-1 Estimating Goodwill and Potential Offering Price LO 7 Plantation Homes Company is considering the acquisition of Condominiums, Inc. early in 2020. To assess the amount it might be willing to pay, Plantation Homes makes the following computations and assumptions. A. Condominiums, Inc. has identifiable assets with a total fair value of $15,000,000 and liabilities of $8,800,000. The assets include office equipment with a fair value approximating book value, buildings with a fair value 30% higher than book value,...
EXERCISE 1-3 Estimated and Actual Goodwill LO 7 Passion Company is trying to decide whether or...
EXERCISE 1-3 Estimated and Actual Goodwill LO 7 Passion Company is trying to decide whether or not to acquire Desiree Inc. The following balance sheet for Desiree Inc. provides information about book values. Estimated market values are also listed, based upon Passion Company's appraisals. Desiree Desiree Inc. Inc. Book Market Values Values Current assets $260,000 $ 260,000 Property, plant & 650,000 equipment (net) _740,000 Total assets $910,000 $1,000,000 Total liabilities $400,000 $ 400,000 Common stock, 160,000 $10 par value Retained...
Exercise 1-1 Plantation Homes Company is considering the acquisition of Condominiums, Inc. early in 2015. To...
Exercise 1-1 Plantation Homes Company is considering the acquisition of Condominiums, Inc. early in 2015. To assess the amount it might be willing to pay, Plantation Homes makes the following computations and assumptions. A. Condominiums, Inc. has identifiable assets with a total fair value of $14,723,000 and liabilities of $8,793,000. The assets include office equipment with a fair value approximating book value, buildings with a fair value 27% higher than book value, and land with a fair value 71% higher...
Plantation Homes Company is considering the acquisition of Condominiums, Inc. early in 2015. To assess the...
Plantation Homes Company is considering the acquisition of Condominiums, Inc. early in 2015. To assess the amount it might be willing to pay, Plantation Homes makes the following computations and assumptions. A. Condominiums, Inc. has identifiable assets with a total fair value of $14,379,000 and liabilities of $8,680,000. The assets include office equipment with a fair value approximating book value, buildings with a fair value 27% higher than book value, and land with a fair value 75% higher than book...
Exercise 1-1 Plantation Homes Company is considering the acquisition of Condominiums, Inc. early in 2015. To...
Exercise 1-1 Plantation Homes Company is considering the acquisition of Condominiums, Inc. early in 2015. To assess the amount it might be willing to p Homes makes the following computations and assumptions. A. Condominiums, Inc. has identifiable assets with a total fair value of $14,398,000 and liabilities of $8,962,000. The assets include office with a fair value approximating book value, buildings with a fair value 33% higher than book value, and land with a fair value 73% hig book value....
Advanced Accounting Chapter 1 – Extra Problems Large Corporation Large Corporation is considering a merger...
Advanced Accounting Chapter 1 – Extra Problems Large Corporation Large Corporation is considering a merger with Local Company, one of its suppliers. In order to determine a fair offering price, Large has accumulated the following information: Local Company Estimated Book Values Market Value Total identifiable assets $ 250,000 $ 300,000 Total liabilities 150,000 150,000 Owners’ equity $ 100,000 In the last five years, Local has earned a total of $100,000. Large expects that Local’s...
LO4 32. Compute the amount of acquired Goodwill, including contingent earnings and bargain purchase Assume you...
LO4 32. Compute the amount of acquired Goodwill, including contingent earnings and bargain purchase Assume you are charged with assigning fair values related to a 53.040,000 acquisition. You determine that the fair value of the net identifiable tangible assets is $1,480,000. You also conclude that the pur- chase included a Customer List with a fair value at $272,000. 4. How much Goodwill will you record in this acquisition, and how is the Goodwill accounted for subsequent to the acquisition? b....
ACCT 401- Assignment- Below are the Balance Sheets of Alpha, Beta and Gamma Ltd for the year to 3...
ACCT 401- Assignment- Below are the Balance Sheets of Alpha, Beta and Gamma Ltd for the year to 31 December 2007 Beta Gamma Alpha 50 450 Investment in: Beta 153 110 95 Inventory A/R Cash 50 197 180 1330 200 40 170 Total Assets A/P 40 100 Share capital Retained earnings Total liabilities and equity 700 430 1330 200 170 Alpha purchased 75% of the share capital of Beta on 1/1/2006 when Beta's retained earnings were £60 Alpha purchased 80%...
Alpha Company is considering the purchase of Beta Company. Alpha has collected the following data about Beta: Total Identifiable assets Total liabilities Owners' equity Beta Company Book Values $631,600 288,700 $342,900 Estimated Market Values $735,800 328,300 Cumulative total net cash earnings for the past five years of $927,700 Includes extraordinary cash gains of $69,800 and nonrecurring cash losses of $44,300. Alpha Company expects a retum on Its Investment of 13%. Assume that Alpha prefers to use cash earnings rather than...
Exercise 1-2 Alpha Company is considering the purchase of Beta Company. Alpha has collected the following data about Beta: Beta Company Estimated Book Values Market Values Total identifiable assets $541,800 $734,700 Total liabilities 317,800 309,500 Owners' equity $224,000 Cumulative total net cash earnings for the past five years of $906,800 includes extraordinary cash gains of $64,800 and nonrecurring cash losses of $46,000. Alpha Company expects a return on its investment of 13%. Assume that Alpha prefers to use cash earnings...
EXERCISE 1-1 Estimating Goodwill and Potential Offering Price LO 7 Plantation Homes Company is considering the acquisition of Condominiums, Inc. early in 2020. To assess the amount it might be willing to pay, Plantation Homes makes the following computations and assumptions. A. Condominiums, Inc. has identifiable assets with a total fair value of $15,000,000 and liabilities of $8,800,000. The assets include office equipment with a fair value approximating book value, buildings with a fair value 30% higher than book value,...
EXERCISE 1-3 Estimated and Actual Goodwill LO 7 Passion Company is trying to decide whether or not to acquire Desiree Inc. The following balance sheet for Desiree Inc. provides information about book values. Estimated market values are also listed, based upon Passion Company's appraisals. Desiree Desiree Inc. Inc. Book Market Values Values Current assets $260,000 $ 260,000 Property, plant & 650,000 equipment (net) _740,000 Total assets $910,000 $1,000,000 Total liabilities $400,000 $ 400,000 Common stock, 160,000 $10 par value Retained...
Exercise 1-1 Plantation Homes Company is considering the acquisition of Condominiums, Inc. early in 2015. To assess the amount it might be willing to pay, Plantation Homes makes the following computations and assumptions. A. Condominiums, Inc. has identifiable assets with a total fair value of $14,723,000 and liabilities of $8,793,000. The assets include office equipment with a fair value approximating book value, buildings with a fair value 27% higher than book value, and land with a fair value 71% higher...
Exercise 1-1 Plantation Homes Company is considering the acquisition of Condominiums, Inc. early in 2015. To assess the amount it might be willing to p Homes makes the following computations and assumptions. A. Condominiums, Inc. has identifiable assets with a total fair value of $14,398,000 and liabilities of $8,962,000. The assets include office with a fair value approximating book value, buildings with a fair value 33% higher than book value, and land with a fair value 73% hig book value....
LO4 32. Compute the amount of acquired Goodwill, including contingent earnings and bargain purchase Assume you are charged with assigning fair values related to a 53.040,000 acquisition. You determine that the fair value of the net identifiable tangible assets is $1,480,000. You also conclude that the pur- chase included a Customer List with a fair value at $272,000. 4. How much Goodwill will you record in this acquisition, and how is the Goodwill accounted for subsequent to the acquisition? b....
ACCT 401- Assignment- Below are the Balance Sheets of Alpha, Beta and Gamma Ltd for the year to 31 December 2007 Beta Gamma Alpha 50 450 Investment in: Beta 153 110 95 Inventory A/R Cash 50 197 180 1330 200 40 170 Total Assets A/P 40 100 Share capital Retained earnings Total liabilities and equity 700 430 1330 200 170 Alpha purchased 75% of the share capital of Beta on 1/1/2006 when Beta's retained earnings were £60 Alpha purchased 80%...
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