On January 1, 2012, Aspen Company acquired 80 percent of Birch Company's outstanding voting stock for $438,000. Birch reported a $457,500 book value and the fair value of the noncontrolling interest was $109,500 on that date. Also, on January 1, 2013, Birch acquired 80 percent of Cedar Company for $200,000 when Cedar had a $205,000 book value and the 20 percent noncontrolling interest was valued at $50,000. In each acquisition, the subsidiary's excess acquisition-date fair over book value was assigned to a trade name with a 30-year life. These companies report the following financial information. Investment income figures are not included. Sales: Aspen Company Birch Company Cedar Company Expenses: Aspen Company Birch Company Cedar Company Dividends declared: Aspen Company Birch Company Cedar Company 2012 2013 2014 $632,500 $747,500 $822,500 416,900 261,250 327,250 Not available 185,900 292,600 $542,500 $522,500 $750,000 261,000 335,000 171,000 250,000 200,000 Not available $15,000 8,000 Not available $45,000 $ 55,000 15,000 6,000 15,000 2,000 Assume that each of the following questions is independent:

On January 1, 2012, Aspen Company acquired 80 percent of Birch Company's outstanding voting stock for $438,000. Birch reported a $457,500 book value and the fair value of the noncontrolling interest was $109,500 on that date. Also, on January 1, 2013, Birch acquired 80 percent of Cedar Company for $200,000 when Cedar had a $205,000 book value and the 20 percent noncontrolling interest was valued at $50,000. In each acquisition, the subsidiary's excess acquisition-date fair over book value was assigned to a trade name with a 30-year life. These companies report the following financial information. Investment income figures are not included. Sales: Aspen Company Birch Company Cedar Company Expenses: Aspen Company Birch Company Cedar Company Dividends declared: Aspen Company Birch Company Cedar Company 2012 2013 2014 $632,500 $747,500 $822,500 416,900 261,250 327,250 Not available 185,900 292,600 $542,500 $522,500 $750,000 261,000 335,000 171,000 250,000 200,000 Not available $15,000 8,000 Not available $45,000 $ 55,000 15,000 6,000 15,000 2,000 Assume that each of the following questions is independent:

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter13: Investments And Long-term Receivables

Section: Chapter Questions

Problem 8MC

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On January 1, 2016, Aspen Company acquired 80 percent of Birch Company's voting stock for $372,000. Birch reported a $360,000 book value and the fair value of the noncontrolling interest was $93,000 on that date. Then, on January 1, 2017, Birch acquired 80 percent of Cedar Company for $180,000 when Cedar had a $126,000 book value and the 20 percent noncontrolling interest was valued at $45,000. In each acquisition, the subsidiary's excess acquisition-date fair over book value was assigned to a trade name with a 30-year remaining life. These companies report the following financial information. Investment income figures are not included. 2016 2017 2018 Sales: Aspen Company $ 517,500 $ 655,000 $ 910,000 Birch Company 272,000 344,250 575,400 Cedar Company Not available 171,900 288,600 Expenses: Aspen Company $ 425,000 $ 545,000 $ 747,500 Birch Company 231,000 266,000 495,000 Cedar Company Not available 161,000 249,000…
On January 1, 2016, Aspen Company acquired 80 percent of Birch Company's voting stock for $480,000. Birch reported a $495,000 book value and the fair value of the noncontrolling interest was $120,000 on that date. Then, on January 1, 2017, Birch acquired 80 percent of Cedar Company for $168,000 when Cedar had a $165,000 book value and the 20 percent noncontrolling interest was valued at $42,000. In each acquisition, the subsidiary's excess acquisition-date fair over book value was assigned to a trade name with a 30-year remaining life. These companies report the following financial information. Investment income figures are not included. 2016 2017 2018 Sales: Aspen Company $ 472,500 $ 645,000 $ 850,000 Birch Company 262,250 337,500 607,300 Cedar Company Not available 233,800 251,600 Expenses: Aspen Company $ 397,500 $ 642,500 $ 690,000 Birch Company 205,000 267,000 520,000 Cedar Company Not available 219,000…
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On January 1, 2016, Aspen Company acquired 80 percent of Birch Company's voting stock for $428,000. Birch reported a $445,000 book value and the fair value of the noncontrolling interest was $107,000 on that date. Then, on January 1, 2017, Birch acquired 80 percent of Cedar Company for $176,000 when Cedar had a $193,000 book value and the 20 percent noncontrolling interest was valued at $44,000. In each acquisition, the subsidiary's excess acquisition-date fair over book value was assigned to a trade name with a 30-year remaining life. These companies report the following financial information. Investment income figures are not included. 2016 2017 2018 Sales: Aspen Company $ 572,500 $ 625,000 $ 767,500 Birch Company 255,750 363,250 582,600 Cedar Company Not available 231,900 267,000 Expenses: Aspen Company $ 390,000 $ 607,500 $ 722,500 Birch Company 193,000 289,000 517,500 Cedar Company Not available 217,000…
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