In order to reduce the risk associated with a new line of business, Conservative Corporation established...
In order to reduce the risk associated with a new line of business, Conservative Corporation established Spin Company as a wholly owned subsidiary. It transferred assets and accounts payable to Spin in exchange for its common stock. Spin recorded the following entry when the transaction occurred:
|
Cash and receivables |
23,000 |
|
|
Inventory |
15,000 |
|
|
Land |
30,000 |
|
|
Buildings |
100,000 |
|
|
Equipment |
95,000 |
|
|
Accounts Payable |
20,000 |
|
|
Accumulated Depreciation—Buildings |
32,000 |
|
|
Accumulated Depreciation—Equipment |
30,000 |
|
|
Common Stock |
56,000 |
|
|
Additional Paid-In Capital |
125,000 |
16) Based on the preceding information, immediately after the transfer,
A) Conservative's total assets decreased by $23,000.
B) Conservative's total assets decreased by $20,000.
C) Conservative's total assets increased by $56,000.
D) Conservative's total assets remained the same.
Please explain the reason for your answer
Homework Answers
Subsidiary company is a part of parent company where parent company transfer the assets and liabilities to subsidiary company. The subsidiary is established by parent company to reduce the risk and losses of the new line of business. The control of subsidiary company is done by parent company.
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In order to reduce the risk associated with a new line of
business, Conservative Corporation established...
In order to reduce the risk associated with a new line of business, Conservative Corporation established...
In order to reduce the risk associated with a new line of
business, Conservative Corporation established Spin Company as a
wholly owned subsidiary. It transferred assets and accounts payable
to Spin in exchange for its common stock. Spin recorded the
following entry when the transaction occurred:
1. Based on the preceding information, what number of shares of
$7 par value stock did Spin issue to Conservative?
A. 10,000
B. 7,000
C. 8,000
D. 25,000
*I know the answer is...
Pace Corporation acquired 100 percent of Spin Company's common stock on January 1, 20X9. Balance sheet...
Pace Corporation acquired 100 percent of Spin Company's common stock on January 1, 20X9. Balance sheet data for the two companies immediately following the acquisition follows: Item Pace Corporation Spin Company Cash $ 30,000 $ 25,000 Accounts Receivable 80,000 40,000 Inventory 150,000 55,000 Land 65,000 40,000 Buildings and Equipment 260,000 160,000 Less: Accumulated Depreciation (120,000 ) (50,000 ) Investment in Spin Company Stock 150,000 Total Assets $ 615,000 $ 270,000 Accounts Payable $45,000 $33,000 Taxes Payable 20,000 8,000 Bonds Payable...
Pab Corporation decided to establish Sollon Company as a wholly-owned subsidiary
Pab Corporation decided to establish Sollon Company as a wholly-owned subsidiary by transferring some of its existing assets and liabilities to the new entity. In exchange, Sollon issued Pab 30,000 shares of $6 par value common stock. The following information is provided on the assets and accounts payable transferred CostBook ValueFair ValueCash$25,000$25.000$25,000Inventory70,00070,00070,000Land60.00060,00090,000Buildings170,000130,000240,000Equipment90,00080,000105.000Accounts Payable45,00045.00045.000Required a. Give the journal entry that Pab recorded for the transfer of assets and accounts payable to Sollon. b. Give the journal entry that Sollon recorded for the receipt of assets...
A9-jY Corporation reported the following account balances at December 31, 2029: Depreciation Expense Copyright Gain on...
A9-jY Corporation reported the following account balances at December 31, 2029: Depreciation Expense Copyright Gain on Sale of Building Dividends Utilities. Payable Rental Revenue Income Tax Expense Cash Utilities Expense Accumulated Depreciation Supplies Retained Earnings Unearned Revenue Cost of Goods Sold Accounts Receivable Accounts Payable Land Notes Payable Inventory Common Stock Equipment Sales Revenue $14,000 $16,000 $18,000 $19,000 $20,000 $23,000 $24,000 $28,000 $31,000 $32,000 $33,000 $41,000 (at January 1, 2029) $42,000 $43,000 $44,000 $49,000 $56,000 $60,000 $64,000 $72,000 $79,000 $94,000...
P4-25 Assignment of Differential in Worksheet LO 4-5 Pork Corporation acquired all the voting shares of...
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...
1. Based on the following data, what is the amount of working capital? Accounts payable....................$32,000 Accounts...
1. Based on the following data, what is the amount of working capital? Accounts payable....................$32,000 Accounts receivable....................64,000 Accrued liabilities....................7,000 Cash.........................................20,000 Intangible assets............................40,000 Inventory...............................................72,000 Long-term investments...............................100,000 Long-term liabilities.....................................75,000 Marketable securities.................................35,000 Notes payable (short-term)........................20,000 Property, plant, and equipment.................625,000 Prepaid expenses.........................................2,000 WHAT IS WORKING CAPITAL? a. $162,000 b. $134,000 c. $193,000 d. $62,000 2. Use the following data to determine the total dollar amount of assets to be classified as current assets. Cash..............................................$60,000 Prepaid insurance..........................40,000 Accounts receivable......................50,000 Inventory.........................................70,000 Land held for investment................80,000 Land................................................95,000...
Additional Information: 1. Net Income for 2019 was $ 43,200 2. The depreciation expense for 2019 is $4,400....
Additional Information:
1. Net Income for 2019 was
$ 43,200
2. The depreciation
expense for 2019 is $4,400.
3. Cash dividends of
$18,200 were declared and paid.
4. Bonds Payable amounting
to $20,000 were redeemed for cash of $20,000.
5. An Equipment costing $
30,500 was purchased by issuing $ 30,500 Common Stock.
6. An Equipment costing
$15,000 and had accumulated depreciation of $ 2,700 was sold for
13,500 cash.
7. Building costing
$37,800 was purchased for cash
8. The land was sold for $
13,000 cash.
Prepare...
How to computer the Accumulated depreciation? Prince Corporation acquired 100 percent of Sword Company on January...
How to computer the Accumulated
depreciation?
Prince Corporation acquired 100 percent of Sword Company on January 1, 20X7, for $19 1,000. The trial balances for the two companies on December 31, 20X7, included the following amounts: Sword Company Debit Credit $ 26,000 71,000 103,000 21,000 152,000 Item Cash Accounts Receivable Inventory Land Buildings and Equipment Investment in Sword Company Cost of Goods Sold Depreciation Expense Other Expenses Dividends Declared Accumulated Depreciation Accounts Payable Mortgages Payable Common Stock Retained Earnings Sales...
Mill Corporation acquired 100 percent ownership of Roller Company on January 1, 20X8, for $128,000. At...
Mill Corporation acquired 100 percent ownership of Roller Company on January 1, 20X8, for $128,000. At that date, the fair value of Roller's buildings and equipment was $20,000 more than book value. Accumulated depreciation on this date was $30,000. Buildings and equipment are depreciated on a 10-year basis. Although goodwill is not amortized, the management of Mill concluded at December 31, 20X8 that goodwill involved in its acquisition of Roller shares had been impaired and the correct carrying value was...
Check my work 1 1 16.66 points Pab Corporation decided to establish Sollon Company as a...
Check my work 1 1 16.66 points Pab Corporation decided to establish Sollon Company as a wholly owned subsidiary by transferring some of its existing assets and abilities to the new entity. In exchange. Solon issued Pab 31000 shares of 56 par value common stock. The following information is provided on the assets and accounts payable transferred Cost Book Value Fair value Cash ) $ 44,000 $4,000 $ 40,000 Inventory 82,000 2.000 32,000 72,00 102,000 Buildings 174,000 135,000 253,000 Equipment...
In order to reduce the risk associated with a new line of
business, Conservative Corporation established Spin Company as a
wholly owned subsidiary. It transferred assets and accounts payable
to Spin in exchange for its common stock. Spin recorded the
following entry when the transaction occurred:
1. Based on the preceding information, what number of shares of
$7 par value stock did Spin issue to Conservative?
A. 10,000
B. 7,000
C. 8,000
D. 25,000
*I know the answer is...
A9-jY Corporation reported the following account balances at December 31, 2029: Depreciation Expense Copyright Gain on Sale of Building Dividends Utilities. Payable Rental Revenue Income Tax Expense Cash Utilities Expense Accumulated Depreciation Supplies Retained Earnings Unearned Revenue Cost of Goods Sold Accounts Receivable Accounts Payable Land Notes Payable Inventory Common Stock Equipment Sales Revenue $14,000 $16,000 $18,000 $19,000 $20,000 $23,000 $24,000 $28,000 $31,000 $32,000 $33,000 $41,000 (at January 1, 2029) $42,000 $43,000 $44,000 $49,000 $56,000 $60,000 $64,000 $72,000 $79,000 $94,000...
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...
Additional Information:
1. Net Income for 2019 was
$ 43,200
2. The depreciation
expense for 2019 is $4,400.
3. Cash dividends of
$18,200 were declared and paid.
4. Bonds Payable amounting
to $20,000 were redeemed for cash of $20,000.
5. An Equipment costing $
30,500 was purchased by issuing $ 30,500 Common Stock.
6. An Equipment costing
$15,000 and had accumulated depreciation of $ 2,700 was sold for
13,500 cash.
7. Building costing
$37,800 was purchased for cash
8. The land was sold for $
13,000 cash.
Prepare...
How to computer the Accumulated
depreciation?
Prince Corporation acquired 100 percent of Sword Company on January 1, 20X7, for $19 1,000. The trial balances for the two companies on December 31, 20X7, included the following amounts: Sword Company Debit Credit $ 26,000 71,000 103,000 21,000 152,000 Item Cash Accounts Receivable Inventory Land Buildings and Equipment Investment in Sword Company Cost of Goods Sold Depreciation Expense Other Expenses Dividends Declared Accumulated Depreciation Accounts Payable Mortgages Payable Common Stock Retained Earnings Sales...
Check my work 1 1 16.66 points Pab Corporation decided to establish Sollon Company as a wholly owned subsidiary by transferring some of its existing assets and abilities to the new entity. In exchange. Solon issued Pab 31000 shares of 56 par value common stock. The following information is provided on the assets and accounts payable transferred Cost Book Value Fair value Cash ) $ 44,000 $4,000 $ 40,000 Inventory 82,000 2.000 32,000 72,00 102,000 Buildings 174,000 135,000 253,000 Equipment...
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