Potash Corporation acquired the voting stock of Safestyle Company on January 1, 2019 for $50 million....
Potash Corporation acquired the voting stock of Safestyle Company on January 1, 2019 for $50 million. Safestyle's book value at the time was $10 million, consisting of $2 million of capital stock and $8 million of retained earnings. The $40 million difference between fair and book value was attributed to goodwill. It is now December 31, 2020, the end of the accounting year and two years after the acquisition. Safestyle's January 1, 2020 retained earnings balance is $11 million, and it reports net income of $1.8 million for 2020. Safestyle declares no dividends and has no other comprehensive income. Goodwill from the acquisition was impaired by $1 million in 2019 and $500,000 in 2020. Potash uses the complete equity method to report its investment in Safestyle on its own books. On the December 31, 2020 consolidation working paper, eliminating entry (R) credits the Investment in Safestyle account by: Select one: A. $38,500,000 B. $39,000,000 C. $40,000,000 D. $39,500,000
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Potash Corporation acquired the voting stock of Safestyle
Company on January 1, 2019 for $50 million....
Potash Corporation acquired the voting stock of Safestyle Company on January 1, 2019 for $50 million....
Potash Corporation acquired the voting stock of Safestyle Company on January 1, 2019 for $50 million. Safestyle’s book value at the time was $10 million, consisting of $2 million of capital stock and $8 million of retained earnings. The $40 million difference between fair and book value was attributed to goodwill. It is now December 31, 2020, the end of the accounting year and two years after the acquisition. Safestyle’s January 1, 2020 retained earnings balance is $11 million. Safestyle...
10 Piato acquirea the voting stock of Safestyle Company on January 1, 2019 for $50 million....
10 Piato acquirea the voting stock of Safestyle Company on January 1, 2019 for $50 million. Safestyle's book value at the time was $10 million, consisting of $2 million of capital stock and $8 million of retained earnings. The $40 million difference between fair and book value was attributed to goodwill. It is now December 31, 2020, the end of the accounting year and two years after the acquisition. Safestyle's January 1, 2020 retained earnings balance is $11 million. Safestyle...
Park Corporation acquired the voting stock of Sequoia Company on January 1, 2020 for $25 million...
Park Corporation acquired the voting stock of Sequoia Company on January 1, 2020 for $25 million in cash and stock. At the date of acquisition, Sequoia's book value totaled $3 million, consisting of $1.6 million in capital stock, $1.8 million in retained earnings, and $400,000 in accumulated other comprehensive losses. Sequoia's reported net assets at the date of acquisition were carried at amounts approximating fair value, except its inventory was overvalued by $500,000 (sold in 2020), its plant assets (10-year...
Park Corporation acquired the voting stock of Sequoia Company on January 1, 2020 for $25 million...
Park Corporation acquired the voting stock of Sequoia Company on January 1, 2020 for $25 million in cash and stock. At the date of acquisition, Sequoia's book value totaled $3 million, consisting of $1.6 million in capital stock, $1.8 million in retained earnings, and $400,000 in accumulated other comprehensive losses. Sequoia's reported net assets at the date of acquisition were carried at amounts approximating fair value, except its inventory was overvalued by $500,000 (sold in 2020), its plant assets (10-year...
A parent acquires the voting stock of a subsidiary on January 1, 2019. Required revaluations of...
A parent acquires the voting stock of a subsidiary on January 1, 2019. Required revaluations of the subsidiary's net assets are: * Previously unreported identifiable intangibles valued at $3 million, with a remaining life of 10 years, straight-line * Goodwill It is now December 31, 2021, three years after the acquisition. The goodwill is unimpaired during this period. The parent reports its investment in the subsidiary using the cost method. The subsidiary reports the following net income, other comprehensive income,...
E4.14 Help please Equity Method Income and Working Paper Eliminations Pace acquired Saber on January 1,...
E4.14 Help please Equity Method Income and Working Paper Eliminations Pace acquired Saber on January 1, 2019, attributing its $200 million excess of acquisition cost over book value to identifiable intangible assets valued at $40 million, with a 5-year life, and to goodwill. At that time Saber’s shareholders’ equity was $2,000 million. It is now December 31, 2020, and consolidation entries are prepared. The investment account balance on January 1, 2020 was $2,286 million. Saber reported net income of $150...
On January 1, 2019, Pali Company acquired 75% of Silicon Company's voting stock for $44,300 in...
On January 1, 2019, Pali Company acquired 75% of Silicon Company's voting stock for $44,300 in cash. The noncontrolling interest had an estimated fair value of $12,700. Silicon's assets and liabilities at the date of acquisition were reported at amounts approximating fair value, but it had previously unreported indefinite life identifiable intangibles valued at $21,000. Silicon's total shareholders' equity at January 1, 2019 was as follows: Capital stock $ 2,000 Retained earnings 2,900 Accumulated other comprehensive income 100 Total $...
On January 1, 2020, Corgan Company acquired 70 percent of the outstanding voting stock of Smashing,...
On January 1, 2020, Corgan Company acquired 70 percent of the outstanding voting stock of Smashing, Inc., for a total of $1,050,000 in cash and other consideration. At the acquisition date, Smashing had common stock of $810,000, retained earnings of $360,000, and a noncontrolling interest fair value of $450,000. Corgan attributed the excess of fair value over Smashing's book value to various covenants with a 20-year remaining life. Corgan uses the equity method to account for its investment in Smashing....
19. On January 1, 2018, Perfect Footgear acquired 60 percent of the voting stock of Shine Sports for $900,000 in ca...
19. On January 1, 2018, Perfect Footgear acquired 60 percent of the voting stock of Shine Sports for $900,000 in cash. The fair value of the noncontrolling interest was $500,000. Shine's book value was $600,000. Date-of-acquisition revaluation information for Shine's net assets is as follows: Plant assets, with a remaining life of 10 years, straight-line, were overvalued by $300,000. Identifiable intangible assets, previously unrecorded, with an 8-year life, straight- line, are valued at $480,000 It is now December 31, 2020,...
On January 1, 2020, Prestige Corporation acquired 100 percent of the voting stock of Stylene Corporation...
On January 1, 2020, Prestige Corporation acquired 100 percent of the voting stock of Stylene Corporation in exchange for $2,244,000 in cash and securities. On the acquisition date, Stylene had the following balance sheet: Accounts payable $ 1,799,000 Cash Accounts receivable Inventory Equipment (net) Trademarks Total assets $ 23,000 125,000 181,000 2,180,000 890,000 $ 3,399,000 Common stock 800,000 Retained earnings 800,000 Total liabilities and equity $ 3,399,000 At the acquisition date, the book values of Stylene's assets and liabilities were...
10 Piato acquirea the voting stock of Safestyle Company on January 1, 2019 for $50 million. Safestyle's book value at the time was $10 million, consisting of $2 million of capital stock and $8 million of retained earnings. The $40 million difference between fair and book value was attributed to goodwill. It is now December 31, 2020, the end of the accounting year and two years after the acquisition. Safestyle's January 1, 2020 retained earnings balance is $11 million. Safestyle...
On January 1, 2020, Corgan Company acquired 70 percent of the outstanding voting stock of Smashing, Inc., for a total of $1,050,000 in cash and other consideration. At the acquisition date, Smashing had common stock of $810,000, retained earnings of $360,000, and a noncontrolling interest fair value of $450,000. Corgan attributed the excess of fair value over Smashing's book value to various covenants with a 20-year remaining life. Corgan uses the equity method to account for its investment in Smashing....
19. On January 1, 2018, Perfect Footgear acquired 60 percent of the voting stock of Shine Sports for $900,000 in cash. The fair value of the noncontrolling interest was $500,000. Shine's book value was $600,000. Date-of-acquisition revaluation information for Shine's net assets is as follows: Plant assets, with a remaining life of 10 years, straight-line, were overvalued by $300,000. Identifiable intangible assets, previously unrecorded, with an 8-year life, straight- line, are valued at $480,000 It is now December 31, 2020,...
On January 1, 2020, Prestige Corporation acquired 100 percent of the voting stock of Stylene Corporation in exchange for $2,244,000 in cash and securities. On the acquisition date, Stylene had the following balance sheet: Accounts payable $ 1,799,000 Cash Accounts receivable Inventory Equipment (net) Trademarks Total assets $ 23,000 125,000 181,000 2,180,000 890,000 $ 3,399,000 Common stock 800,000 Retained earnings 800,000 Total liabilities and equity $ 3,399,000 At the acquisition date, the book values of Stylene's assets and liabilities were...
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