COMBINED CORPORATE ENTITIES AND CONSOLIDATIONS
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A: PREDETERMINED OVERHEAD RATEPredetermined rate means the indirect cost rate.Predetermined overhead…
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A: A journal entry is a formal accounting record that documents a financial transaction in a company's…
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A: Temporary accounts are accounts that are used to track financial activities for a specific…
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A: Journal: The journal is the initial entry point where all financial transactions are recorded…
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A: Dividends tax is a tax levied on shareholders when they receive dividends from a company. Dividends…
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A: BALANCE SHEET Balance sheet is one of the Important Financial Statement of the Company. Balance…
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A: The "cash outlay" means the actual spending or payment of money for a certain goal in business. It…
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A: JOURNAL ENTRIESJournal Entry is the first stage of Accounting Process. Journal Entry is the Process…
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A: Restructuring debt refers to the process of modifying the terms and conditions of existing debt…
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A: FormulasEPS = EAT/ Shares OutstandingDOL= Contribution Margin/ EBITDFL-= EBIT/EATDCL=Contribution…
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Q: What is Management accounting and how does it work?
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A: Journal entry: Journal entry is a set of economic events which can be measured in monetary terms.…
Q: Transcribed Text G
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A: EBIT is a financial metric that represents a company's operating profit, indicating how much profit…
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A: Liquidity metric:Liquidity metric means liquidity ratios. A liquidity ratio is a measurement which…
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- Libra Company is purchasing 100% of the outstanding stock of Genall Company for $700,000. Genall has the following balance sheet on the date of acquisition: (see attachment)Appraisals indicate that the following fair values for the assets and liabilities should be acknowledged: Accounts receivable . . . . . . . . . . . . . . . $300,000 Inventory . . . . . . . . . . . . . . . . . . . . . . . . 215,000 Property, plant, and equipment . . . . . . . 700,000 Computer software . . . . . . . . . . . . . . . . 130,000 Current liabilities . . . . . . . . . . . . . . . . . . 250,000 Bonds payable . . . . . . . . . . . . . . . . . . . 210,000 1. Prepare the value analysis schedule and the determination and distribution of excess schedule. 2. Prepare the elimination entries that would be made on a consolidated worksheet prepared on the date of purchase.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…Acquirer Company purchased the net asset of Acquiree Company (excluding cash) by paying P250,000 cash, issuing shares with a fair value of P1,810,000 and issuing a bond debenture with a fair value of P380,000 on January 2, 2022. The financial statements of Acquirer and Acquiree as of this date were as follows (see image below).The book value reflected the fair value of the assets and liabilities except that the inventory of Acquirer had a fair value of 1,500,000 and the inventory and equipment of Acquiree had fair values of P750,000 and P1,400,000 respectively. Acquirer also incurred the following costs: Finder’s fee – P10,000; Accountant’s fee – P15,000; Legal fees – P7,500; Printing of stock certificates – P5,000; and Audit and accountant’s fee related to stock issuance – P20,000. Acquirer only paid 50% of the said acquisition related costs. Answer the following: a. How much is the Consolidated Equity? b. How much is the Goodwill/Gain on Bargain Purchase? c. How much is the…
- Quail Company purchases 80% of the common stock of Commo Company for $800,000. At the time of the purchase, Commo has the following balance sheet: (see attachment)The fair values of assets are as follows: Cash equivalents . . . . . . . . . . . . . . . . . . $120,000 Inventory . . . . . . . . . . . . . . . . . . . . . . . . 250,000 Land. . . . . . . . . . . . . . . . . . . . . . . . . . . . 200,000 Building . . . . . . . . . . . . . . . . . . . . . . . . . 650,000 Equipment . . . . . . . . . . . . . . . . . . . . . . . 200,000 1. Prepare the value analysis schedule and the determination and distribution of excess schedule under three alternatives for valuing the NCI: a. The value of the NCI is implied by the price paid by the parent for the controlling interest. b. The market value of the shares held by the NCI is $45 per share. c. The international accounting option, which does not allow goodwill to be recorded as part of the NCI, is used. 2. Prepare the elimination entries that would…The following are summarized Balance Sheets as on March 31, 2020 H. Ltd. acquired 80% shares in S Ltd. on October 1, 2019 for $ 2,000. At the date of acquisitionall the assets and liabilities of S Ltd were reflected at fair valueThe Retained earnings of S Ltd. on April 1, 2019 was $ 200H Ltd measures the Non Controlling Interest at its proportionate share of the acquiree's netidentifiable assets.S Ltd transferred goods to H Ltd at a transfer price of $ 300. The sales policy of H Ltd is to add50 % of mark up to its cost. Two-thirds remained in inventory at the year end. Required : Calculate goodwill at the date of acquisition and unrealized profit for holding companyOn 1 July 2021, James Ltd acquired all the issued shares of Dean Ltd for $350,000. At this date, the financial statements of Dean Ltd showed the following: $ Share capital 270,000 Retained earnings 26,500 General Reserve 8,800 Total equity 305,300 Goodwill 25,000 At acquisition date, all the net identifiable assets and liabilities in Dean Ltd were recorded at amounts equal to their fair value except for: Asset Carrying amount ($) Fair Value ($) Inventories 15,000 18,000 Plant (cost $400,000) 210,000 220,000 The Plant was calculated to have a further life of 5 years, and was depreciated on a straight-line basis. All inventory was sold by 30 June 2020. Assume 30% tax rate Required: Prepare the acquisition analysis at 1 July 2021. Prepare the consolidation entries at acquisition date, 1 July 2021. Include narrations for each entry. Prepare the consolidation worksheet as at 1 July 2021. Prepare a Balance sheet for the reporting Group, James Ltd as at 1 July 2021 in narrative format.
- On October 1, Dennis Company purchased ₱200,000 face value, 12% bonds at 98 plus accrued interestand brokerage fees and classified them as amortized cost assets. Interest is paid semiannually on January1 and July 1. Brokerage fees for this transaction were ₱700. At what amount should this acquisition ofbonds be recorded?Pam Company acquires the net assets of Jam Company for an agreed-upon price of $900,000 on July 1, 2015. The value is tentatively assigned as follows:Current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 100,000Land. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50,000Equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 200,000 (5-year life)Building . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 500,000 (20-year life)Current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (150,000)Goodwill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 200,000Values are subject to change during the measurement period. Depreciation is taken to the nearest month. The measurement period expires on July 1, 2016, at which time the fair values of the equipment and building as of the acquisition date…On December 31, 20X8, Paragraph Corporation acquired 80 percent of Sentence Company's common stock for $136,000. At the acquisition date, the book values and fair values of all of Sentence's assets and liabilities were equal. Paragraph uses the equity method in accounting for its investment. Balance sheet information provided by the companies at December 31, 20X8, immediately following the acquisition is as follows: Cash Accounts Receivable Inventory Fixed Assets (net) Investment in Sentence Co. Total Debits Accounts Payable Notes Payable Common Stock Retained Earnings Total Credits Assets Paragraph Corporation $ 74,000 120,000 180,000 Total Assets Liabilities and Stockholders' Equity 350,000 136,000 $860,000 Total Liabilities and Stockholders' Equity $ 65,000 350,000 150,000 295,000 $860,000 PARAGRAPH CORPORATION AND SUBSIDIARY Consolidated Balance Sheet December 31, 20X8 Required: Prepare a consolidated balance sheet for Paragraph at December 31, 20X8. Sentence Company $ 20,000…
- 1. S acquired 100 percent of F for P275,000. At the date of acquisition, F had the following book and market values: (see image below) What is the amount of the “Investment in F” account on S’s financial records at the acquisition date?On Nov. 2th 2020, ABC Corporation paid OMR800,000 for all the issued and outstanding common stock of XYZ, Inc., in a transaction properly accounted for as an acquisition. The book values and fair values of XYZ's assets and liabilities on Nov. 2th were as follows Fair Value Book Value Cash OMR 80,000 OMR 80,000 Receivables (net) 90,000 90,000 Liabilities 175,000 175,000 Inventory 150,000 157,500 Plant and equipment (net) 460,000 410,000 The fair value of net assets is: Select one: O a. OMR(275,000) O b. OMR(525,000) OC OMR275,000 O d. OMR525,000 O e. OMR(280,000) oull lia sI OWoolco, Inc., purchased all the outstanding stock of Paint, Inc., for $980,000. Woolco also paid $10,000 in direct acquisition costs. Just before the investment, the two companies had the following balance sheets: Assets Woolco, Inc. Paint, Inc. Accounts receivable . . . . . . . . . . . . . . . $ 900,000 $ 500,000 Inventory . . . . . . . . . . . . . . . . . . . . . . . . 600,000 200,000 Depreciable fixed assets (net) . . . . . . . . 1,500,000 600,000 Total assets. . . . . . . . . . . . . . . . . . . . . $3,000,000 $1,300,000 Liabilities and Equity Current liabilities . . . . . . . . . . . . . . . . . . $ 950,000 $ 400,000 Bonds payable . . . . . . . . . . . . . . . . . . . 500,000 200,000 Common stock ($10 par). . . . . . . . . . . . 400,000 300,000 Paid-in capital in excess of par . .…