5. how much is the goodwill/(gain from bargain purchase) at the date of acquisition?6. how much is the total assets at the date of acquisition? Parent Corporation acquired all the identifiable net assets of Sub Company by issuing ordinary shares on January 2,2022. Partial balance sheet for the companies prior to the business combination and immediately following thecombination is provided:Parent65,000Sub25,00020,00045,000Consolidated60,00094,00088,000CashAccounts receivableInventoryBuildings72,00033,000400,000140,000650,000Goodwill570,00010,000240,000Total assets?50,000Accounts payableBonds payableCommon stock, P2 parShare premiumRetained earningsTotal liabilities and equities250,000100,00065,00025,000100,00025,00075,000350,000160,00020,000105,000570,00070,000240,000100,000The only consideration transferred is the issuance of shares with fair value of P8. Parent also paid businesscombination expenses, share issue costs are twice the amount of indirect costs. Parent and Sub are SMES.

Herein above we need to first calculate the fair value of net asset acquired. Calculation of Fair…

Parent Corporation acquired all the identifiable net assets of Sub Company by issuing ordinary shares on January 2, 2022. Partial balance sheet for the companies prior to the business combination and immediately following the combination is provided: Sub 25,000 Parent 65,000 72,000 33,000 Consolidated 60,000 94,000 88,000 650,000 Cash Accounts receivable Inventory Buildings Goodwill 20,000 45,000 140,000 400,000 10,000 240,000 Total assets 570,000 ? Accounts payable Bonds payable 50,000 25,000 75,000 250,000 100,000 350,000

Parent Corporation acquired all the identifiable net assets of Sub Company by issuing ordinary shares on January 2, 2022. Partial balance sheet for the companies prior to the business combination and immediately following the combination is provided: Sub 25,000 Parent 65,000 72,000 33,000 Consolidated 60,000 94,000 88,000 650,000 Cash Accounts receivable Inventory Buildings Goodwill 20,000 45,000 140,000 400,000 10,000 240,000 Total assets 570,000 ? Accounts payable Bonds payable 50,000 25,000 75,000 250,000 100,000 350,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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