CA answer Ch1

WAG PAPALOKO Inc. has the following balance sheet on January 1, 2018, which is the date of acquisition:   Assets   Liabilities and Equity Accounts Receivable 79,000   Current Liabilities 145,000 Inventory 112,000   Long-term notes 100,000 Other current assets 55,000   Ordinary share, P1 par 50,000 Equipment (net) 294,000   Share premium 200,000 Goodwill 30,000   Retained earnings 75,000 Total assets 570,000   Total liabilities and equity 570,000 On January 1, 2018, WAG PAPATINAG Corp. acquired the net assets of WAG PAPALOKO Inc. by issuing 7,000 shares of its P25 par value common stock. Subsequently, WAG PAPALOKO Inc. was liquidated and its assets and liabilities merged into WAG PAPATINAG Corp. WAG PAPATINAG Corp. and WAG PAPALOKO Inc. stocks were selling for P40 per share and P6 per share, respectively on January 1, 2018. The book values of WAG PAPALOKO Inc.’s identifiable assets and liabilities equaled their fair…

WAG PAPALOKO Inc. has the following balance sheet on January 1, 2018, which is the date of acquisition:   Assets   Liabilities and Equity Accounts Receivable 79,000   Current Liabilities 145,000 Inventory 112,000   Long-term notes 100,000 Other current assets 55,000   Ordinary share, P1 par 50,000 Equipment (net) 294,000   Share premium 200,000 Goodwill 30,000   Retained earnings 75,000 Total assets 570,000   Total liabilities and equity 570,000   On January 1, 2018, WAG PAPATINAG Corp. acquired the net assets of WAG PAPALOKO Inc. by issuing 7,000 shares of its P25 par value common stock. Subsequently, WAG PAPALOKO Inc. was liquidated and its assets and liabilities merged into WAG PAPATINAG Corp. WAG PAPATINAG Corp. and WAG PAPALOKO Inc. stocks were selling for P40 per share and P6 per share, respectively on January 1, 2018. The book values of WAG PAPALOKO Inc.’s identifiable assets and liabilities equaled their fair…

5 WAG PAPALOKO Inc. has the following balance sheet on January 1, 2018, which is the date of acquisition:   Assets   Liabilities and Equity Accounts Receivable 79,000   Current Liabilities 145,000 Inventory 112,000   Long-term notes 100,000 Other current assets 55,000   Ordinary share, P1 par 50,000 Equipment (net) 294,000   Share premium 200,000 Goodwill 30,000   Retained earnings 75,000 Total assets 570,000   Total liabilities and equity 570,000   On January 1, 2018, WAG PAPATINAG Corp. acquired the net assets of WAG PAPALOKO Inc. by issuing 7,000 shares of its P25 par value common stock. Subsequently, WAG PAPALOKO Inc. was liquidated and its assets and liabilities merged into WAG PAPATINAG Corp. WAG PAPATINAG Corp. and WAG PAPALOKO Inc. stocks were selling for P40 per share and P6 per share, respectively on January 1, 2018.   The book values of WAG PAPALOKO Inc.’s identifiable assets and liabilities equaled…

The following is the balance sheet of Sameed Brothers ­Corporation (000s omitted). Sameed Brothers CorporationBalance SheetDecember 31, 2020 Assets Current assets            Cash $26,000    Marketable securities 18,000    Accounts receivable 25,000    Inventory 20,000    Supplies 4,000    Stock investment in subsidiary company  20,000 $113,000 Investments      Treasury stock   25,000 Property, plant, and equipment      Buildings and land 91,000    Less: Reserve for depreciation  31,000 60,000 Other assets      Cash surrender value of life insurance     19,000   Total assets   $217,000 Liabilities and Stockholders' Equity Current liabilities            Accounts payable $22,000    Reserve for income taxes 15,000    Customers' accounts with credit balances       1 $  37,001 Deferred credits      Unamortized premium on bonds payable   2,000 Long-term liabilities      Bonds payable     60,000   Total liabilities   99,001 Common…

A corporation is studying the possibility of acquiring Entity E whose statement of financial position had the following balances at the date of valuation: Current assets 450,000 Investments 150,000 PPE-net 1,200,000 Accounts payable 130,000 Accrued liabilities 110,000 Bonds payable 300,000 Share capital 150,000 Share premium 510,000 Retained earnings 600,000 According to an appraisal report requested by the company, the investments had a fair value of P450,000 and the inventory was understated by P240,000. All other assets and equities are properly stated. An examination of Entity E's income for the last 4 years indicates that the net income has steadily increased by 20%. Entity E had a net operating income of P300,000 in the year of valuation. The valuation expert believes that a normal rate of return for a business of this type is 16%. Assets are expected to stay the same for the next 4 years. Determine the estimated value of Entity E assuming goodwill is computed through…

8 WAG PAPALOKO Inc. has the following balance sheet on January 1, 2018, which is the date of acquisition:   Assets   Liabilities and Equity Accounts Receivable 79,000   Current Liabilities 145,000 Inventory 112,000   Long-term notes 100,000 Other current assets 55,000   Ordinary share, P1 par 50,000 Equipment (net) 294,000   Share premium 200,000 Goodwill 30,000   Retained earnings 75,000 Total assets 570,000   Total liabilities and equity 570,000   On January 1, 2018, WAG PAPATINAG Corp. acquired the net assets of WAG PAPALOKO Inc. by issuing 7,000 shares of its P25 par value common stock. Subsequently, WAG PAPALOKO Inc. was liquidated and its assets and liabilities merged into WAG PAPATINAG Corp. WAG PAPATINAG Corp. and WAG PAPALOKO Inc. stocks were selling for P40 per share and P6 per share, respectively on January 1, 2018.   The book values of WAG PAPALOKO Inc.’s identifiable assets and liabilities equaled their…

CARAT CORP. has completed its current year financial statements which reveal, in part, the following information: *Profit for the year - P110,000 *Total Comprehensive Income - P130,000 *Other comprehensive income relates to the revaluation of land and buildings to fair value *Dividends paid - P35,000 *Opening equity balances - share capital P300,000, retained earnings P220,000, asset revalution surplus P60,000 *No more share capital was issued during the reporting period The total equity at the end of the current year is: Choices a. 695,000 b. 675,000 c. 655,000 d. 580,000

Show the complete solution. Thank you The Statement of Financial Position (SFP) of Arthur Corporation on June 30, 202X is presented below: Current Assets P195,000 Land 1,320,000 Building 660,000 Equipment 525,000 Total Assets P2,700,000     Liabilities P525,000 Ordinary Shares, P5 par 900,00 Share Premium 825,000 Retained Earnings 450,000 Total Equities P2,700,000 All the assets and liabilities of Arthur were assumed to approximate their fair values except for land and building. It is estimated that the land has a fair value of P2,100,000, and the fair value of the building increased by P480,000. Ezekeil Corporation acquired 80% of Arthur’s outstanding shares for P3,000,000. The non-controlling interest is measured at fair value. Required Determine the goodwill or gain on bargain purchase assuming the consideration paid includes control premium of P852,000. Determine the goodwill or gain on bargain purchase…

5. PSA Inc. prepared a draft of its 2021 Statement of Financial Position. The draft statement reported total assets of P4.375,000. The total assets included the following items.             Treasury shares of PSA Inc. at cost, which approximates market value                         on December 31                                                         P120,000             Unamortized patent                                                                    56,000             Cash surrender value of life insurance                                       68,500             Cumulative translation loss                                                         42,000 At what amount should total assets be correctly reported in the December 31,2010 Statement of Financial Position?

GREY Corp's statement of financial position prior to the acquisition is shown as follows: ASSETS LIABILITIES AND EQUITY Cash 170,000 Liabilities 400,000 80,000 Accounts Receivable 50,000 Ordinary Share, P4 Inventories 100,000 Share Premium 320,000 Property, Plant and Equipment 880,000 Retained Earnings 400,000 TORRES Company will issue shares of P10 par value ordinary shares capital for all the assets and liabilities of GREY Company. As of acquisition date, TORRES Company's ordinary share capital has a current market value of P40 per share. The fair value of he current assets is P400,000 while that of the plant assets is P1,600,000. All the liabilities are correctly stated. TORRES Company issued sufficient share capital so that the fair value of the shares issued is equal to the fair market value of GREY Company's assets. To have goodwill of P200,000 the number of shares to be issued by TORRES Company should be

​On April 1, 20x8 Phar acquired 90% of the Equity Shares of Star. Star retained profits at the date of acquisition were $ 2, 640,000.     Balance Sheet as at 31 March 20x9.       Phar   Star     $000 $000 $000 $000 Non-Current Assets         PPE 2,544   2,388   Intangible Software -   2,520   Investments-Equity in Star 5, 036   -   Others 214   252       7,794   5,160 Current Assets         Inventories 863   672   Receivables 629   394   Stars Current Account   90     -   Cash 24   -       1,606   1,066     9,400   6,226 Capital and Reserves         Equity shares of $1 each   2,400   1,800 Share Premium 2,400…

Linden Corporations is negotiating for the purchase of Hill Company. The following is an abbreviated balance sheet of Hill. Assets Cash Land Equipment, net Trademark Total assets Additional Information: Hill Company Balance Sheet As of December 31, 2025 $100,000 230,000 200,000 40,000 $570.000 Liabilities and Stockholders' Equity Accounts payable Notes payable (long-term) Common stock Retained earnings Total liabilities and stockholders' equity 1. Land is undervalued by $20,000. 2. Equipment is overvalued by $3,000. Hill agrees to sell the business to Linden for $370,000. $150,000 250,000 140,000 30,000 $570,000 Instructions Prepare the entry to record the purchase of Hill Company on Linden's books.

Please answer the exercise step by step and clear. Thank you.   Sony Corporation paid $350,000 cash for 42% of the voting common stock of Micro Inc. on January 1, 2021. Book value and fair value information for Inc. in this date is as follows:   Assets Cash Accounts receivable Inventories Equipment Book Values $60,000 120,000 80,000 340,000 $ 600,000 Fair Values $60,00   Instructions:   1. Prepare the journal entries for purchased investment.   2. Prepare the analysis of the cost versus the book value of the net assets of the investment bought in Micro Inc by Sony Corporation.   3. Prepare the schedule with the differences between the book value and the fair value of the identifiable net assets of Micro Inc.   4. At the end of the year, Micro Inc was:   a. Net Income for $300,000   b. Paid dividends at Dec 31, 2021 for $35,000   Prepare the journal entries related with net income and dividends received Sony Corporation for Micro Inc.

Asset versus stock acquisition. Barstow Company is contemplating the acquisition of the net assets of Crown Company for $875,000 cash. To complete thetransaction, acquisition costs are $15,000. The balance sheet of Crown Company on the purchase date is as follows:Crown CompanyBalance SheetDecember 31, 2015Assets Liabilities and EquityCurrent assets . . . . . . . . . . . . . . . . . . . . . $ 80,000 Liabilities . . . . . . . . . . . . . . . . $100,000Land. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70,000 Common stock ($10 par). . . . 100,000Building . . . . . . . . . . . . . . . . . . . . . . . . . . 450,000 Paid-in capital in excess of par 150,000Accumulated depreciation—building . . . (200,000) Retained earnings . . . . . . . . . 250,000Equipment . . . . . . . . . . . . . . . . . . . . . . . . 300,000Accumulated depreciation—equipment . (100,000)Total assets. . . . . . . . . . . . . . . . . . . . . . $ 600,000 Total liabilities and equity . $600,000The following fair…

An entity reported net assets totaling P8,750,000 at year-end which included the following: Treasury shares, at cost 250,000 Idle machinery 100,000 Trademark 150,000 Allowance for inventory writedown 200,000   What amount should be reported as net assets?

On 1 July 2022, Susan Ltd took control of the assets and liabilities of Adam Ltd. At this date the statement of financial position of Adam Ltd was as follows:   Carrying amount Fair value Machinery $60,000 $87,000 Fixtures & Fittings 80,000 88,000 Vehicles 55,000 55,000 Current Assets 30,000 32,000 Current Liabilities (36,000) (38,000) Total Net assets 189,000   Share capital (100 000 shares) 100,000   General reserve 40,000   Retained earnings 49,000   Total Equity 189,000   Susan Ltd agreed to: (i) pay the shareholders of Adam Ltd one share in Susan Ltd for every two shares held in Adam Ltd. Shares in Susan Ltd have a fair value of $2.00 per share. The costs of issuing the shares by Susan Ltd costed $2,800 (ii) pay the shareholders of Adam Ltd $1 in cash for each share held in Adam Ltd. On 1 July 2022, Adam Ltd is currently being sued by a previous customer. The expected damage is $100,000. Lawyers estimate that there is a 10% chance of losing the case.…

Mans Company is about to purchase the net assets of Eagle Incorporated, which has the following balance sheet:   Assets     Accounts receivable   $  60,000 Inventory   100,000 Equipment $  90,000   Accumulated depreciation   (50,000) 40,000       Land and buildings $300,000   Accumulated depreciation (100,000) 200,000 Goodwill       60,000      Total assets   $460,000       Liabilities and Stockholders' Equity     Bonds payable   $  80,000 Common stock, $10 par   200,000 Paid-in capital in excess of par   100,000 Retained earnings       80,000      Total liabilities and equity   $460,000   Mans has secured the following fair values of Eagle's accounts:   Inventory $130,000 Equipment 60,000 Land and buildings 260,000 Bonds payable 60,000   Acquisition costs were $20,000.   Required:   Record the entry for the purchase of…

At the time of acquisition X & Y Co., stock issue expected cost expenses OMR 48,000.  Finally, acquisition cost was OMR 64,000. How much will record in the income statement. Select one: a. OMR 48,000 b. OMR 64,000 c. OMR 16,000 d. OMR 112,000

Mans Company is about to purchase the net assets of Eagle Incorporated, which has the following balance sheet:   Assets     Accounts receivable   $  60,000 Inventory   100,000 Equipment $  90,000   Accumulated depreciation   (50,000) 40,000       Land and buildings $300,000   Accumulated depreciation (100,000) 200,000 Goodwill       60,000      Total assets   $460,000       Liabilities and Stockholders' Equity     Bonds payable   $  80,000 Common stock, $10 par   200,000 Paid-in capital in excess of par   100,000 Retained earnings       80,000      Total liabilities and equity   $460,000   Mans has secured the following fair values of Eagle's accounts:   Inventory $130,000 Equipment 60,000 Land and buildings 260,000 Bonds payable 60,000   Acquisition costs were $20,000.   Required:   Record the entry for the purchase of…

Ledger Properties of XYZ Itd has the following financlal information: Current Prior Year Year Revenues $18,915 $13,610 Administrative 2,106 1,602 expenses Interest expense 816 468 Cost of goods 9,715 6,309 sold Depreciation 408 387 Net fixed assets 12,711 11,984 Current liabilities 4,652 4,625 Common stock 5,000 4,000 Current assets 6,506 4,687 Long-term debt 2,200 ? Retained earnings 1365 246 Dividends paid 290 275 What is the cash flow of the firm for the current year if the tax rate is 12 percent? Select one:a. 1500 b. 2096 c. 25000

5. The following information are related to Bacon Corporation: Sales Asset Turnover Php 15,000,000 3.0x Debt to Equity Ratio Weighted average outstanding shares 1.5 200,000 shares Asset turnover only considered asset balance as of December 31. How much is the book value per share of Bacon Corporation based on the foregoing information. a) Php75.00 b) Php25.00 c) Php15.00 d) Php10.00

Additional information: * All purchases of inventories are on credit * The selling and administrative expenses include depreciation of R320 000 * Property, plant and  equipment were purchased during the year but there were no disposals  * The total dividends for the year ended 31 December 2021 amounted to R360 000 * The issued share capital consisted of 100 000 ordinary shares * The market price of the shares on 31 December 2021 was R35

Redcliff Ltd acquired the entire share capital of ABC Ltd for $18,000 cash on 31 December 20X4.The balance sheets of the two companies as at that date were as follows:          Redcliff Ltd                                                                             ABC Ltd$ $ $Current assets 240,000                                                        28,800Non-current assets:Investment in ABC at cost 18,000Other asset 96,000 114,000 9,600Total assets 354,000 38,400Current liabilities 198,000 20,400Net assets 156,000 18,000Paid-up capital 120,000 12,000Retained profits 36,000 6,000Owners’ equity 156,000 18,000Required:Prepare the consolidated balance sheet of Redcliff Ltd and its subsidiary as it 31 december 20X4.

REQUIREMENT : Compute for the Net Sales At the beginning of the current year, Glasgow Company started business and issued share capital, 60,000 shares with P100 par, for the following considerations: Cash - P500,000; Building with useful life of 15 years - P4,500,000; and Land - P1,500,000. An analysis of the bank statements showed total deposits, including the original cash investment, of P3,500,000. The balance in the bank statement on December 31 was P250,000 but there were checks amounting to P50,000 dated in December but not paid by the bank until January of next year. Cash on hand on December 31 was P125,000 including customers' deposit of P75,000. During the year, the entity borrowed P500,000 from the bank and repaid P125,000 and P25,000 interest. The proceeds of the loan were credited to the bank account of the entity. Disbursements paid in cash during the year were as follows: Utilities - P100,000; Salaries - P100,000; Supplies - P175,000; Taxes - P25,000; and Dividends -…

Marin Company provides you with the following condensed balance sheet information: Assets Current assets       $ 41,700 Equity investments       60,000 Equipment (net)       227,600 Intangibles       55,500    Total assets       $384,800 Liabilities and Stockholders’ Equity Current and long-term liabilities       $96,400 Stockholders’ equity            Common stock ($5 par)   $ 19,700        Paid-in capital in excess of par   107,300        Retained earnings   161,400   288,400      Total liabilities and stockholders’ equity       $384,800 For each of the following transactions, indicate the dollar impact (if any) on the following five items: (1) total assets, (2) common stock, (3) paid-in capital in excess of par, (4) retained earnings, and (5) stockholders’ equity. (Each situation is independent.)(a) Marin declares and pays a $0.55 per share cash dividend. (1)   Total assets                                                                 $…

15. Dumaguete Company provided the following post-closing trial balance at year-end: Accounts payable and accrued liabilities 3,000,000 Accounts receivable 6,000,000 Accumulated depreciation 2,500,000 Allowance for doubtful accounts 800,000 Bonds payable 5,000,000 Property, plant and equipment 11,000,000 Cash 2,500,000 Ordinary share capital, P50 par value 6,000,000 Dividends payable 200,000 Inventory 8,000,000 Available for sale securities 3,500,000 Investment in equity securities, at cost 2,000,000 Unrealized loss on interest rate swap designated as cash flow 500,000 hedge Share premium – ordinary In excess of par 5,000,000 From sale of treasury 1,000,000 Preference Share Capital, P25 par value 5,000,000 Retained Earnings 6,500,000 Treasury ordinary shares - 20,000 at cost 1,500,000 The dividend on cumulative preference share capital is 10%. The preference share has a liquidation value of P50. What is the amount should be reported as shareholder's equity? a. 22,000,000 b. 21,500,000…