How was cost price of $193,750 calculated? can you show me how they got figure? Homework help starts here!ASK AN EXPERTCHAT VX MATH SOLVERE Q&A LibraryOn January 1, 2020, Corgan Company acquired 80 p...Step 2The inventory profit for 2020 and 2021 is given below,Consideration transferred1,600,000Add: Non controlling interest fair value400,000Smashing's acquisition date fair value2,000,000Less: Book value of subsidiary [910,000 + 460,000](1,370,000)Excess fair book value (assigned to covenants)630,000Divide by: Useful life20yearsAnnual amortization31,5002020 Inventory profitInventory purchased310,000Profit %60%Cost price193,750Gross profit on transfer (310,000 - 193,750]116250Unsold inventory %50%Deferred profit58,1252021 Inventory profit Homework help starts here!ASK AN EXPERTCHAT VX MATH SOLVERE Q&A LibraryOn January 1, 2020, Corgan Company acquired 80 p...FINANCIALACCOUNTINGFINANCIAL ACCOUNTINGMeipSave & ExitSubmit10th EditionISBN: 9781259964947On January 1, 2020, Corgan Company acquired 80 percent of the outstanding voting stock of Smashing, Inc., for a totalof $1,600,000 in cash and other consideration. At the acquisition date, Smashing had common stock of $910,000,retained earnings of $460,000, and a noncontrolling interest fair value of $400,000. Corgan attributed the excess of fairvalue over Smashing's book value to various covenants with a 20-year remaining life. Corgan uses the equity method toaccount for its investment in Smashing.FINDAuthor: LibbyPublisher: MCGDuring the next two years, Smashing reported the following:Chapter 1: F... vSection: Ch...InventoryPurchasesDividendsNet IncomeDeclared20202021$360,000340,000from Corgan$310,000330,000$56,000Problem 1Q66,000Corgan sells inventory to Smashing using a 60 percent markup on cost. At the end of 2020 and 2021, 50 percent of thecurrent year purchases remain in Smashing's inventory.E Not helpful? See similar booksa. Compute the equity method balance in Corgan's Investment in Smashing, Inc., account as of December 31, 2021.b. Prepare the worksheet adjustments for the December 31, 2021, consolidation of Corgan and Smashing.Complete this question by entering your answers in the tabs below.Learn more aboutRequired ARequired BConsolidation3 of 5Next >< PrevMacBook AirStuck on Your>!!!

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Description: How was cost price of $193,750 calculated? can you show me how they got figure? Homework help starts here!ASK AN EXPERTCHAT VX MATH SOLVERE Q&A LibraryOn January 1, 2020, Corgan Company acquired 80 p...Step 2The inventory profit for 2020 and 2021 is

In this question, student has ask that how the value of cost price that is $193,750 is calculated,…

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The inventory profit for 2020 and 2021 is given below, Consideration transferred Add: Non controlling interest fair value 1,600,000 400,000 Smashing's acquisition date fair value 2,000,000 Less: Book value of subsidary 1910,000 + 460,000] Excess fair book value (assigned to covenants) Divide by: Useful life Annual amortization (1,370,000) 630,000 20years 31,500 2020 Inventory profit Inventory purchased 310,000 Profit % 60% Cost price 193,750 Gross profit on transfer (310,000 - 193,750) Unsold inventory % 116250 50% Deferred profit 58,125

The inventory profit for 2020 and 2021 is given below, Consideration transferred Add: Non controlling interest fair value 1,600,000 400,000 Smashing's acquisition date fair value 2,000,000 Less: Book value of subsidary 1910,000 + 460,000] Excess fair book value (assigned to covenants) Divide by: Useful life Annual amortization (1,370,000) 630,000 20years 31,500 2020 Inventory profit Inventory purchased 310,000 Profit % 60% Cost price 193,750 Gross profit on transfer (310,000 - 193,750) Unsold inventory % 116250 50% Deferred profit 58,125

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

Chapter15: Contributed Capital

Section: Chapter Questions

Problem 17E

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PART C Petro Incorporated and Sport Company reported summarized balance sheets as shown below, on December 31, 2019. Petro $1,050,000 1,675,000 $575,000 875,000 Sport $525,000 1,075,000 $125,000 375 000 Current assets Noncurrent assets Current liabilities Long-term debt On January 1, 2020, Petro purchased 80% of the outstanding capital stock of Sport for $980,000, of which $230,000 was paid in cash, and $750,000 was borrowed from their bank. The debt is to be repaid in 10 annual installments beginning on December 31, 2020, with each payment consisting of $75,000 principal, plus accrued interest. The excess fair value of Sport Company over the underlying book value is allocated to inventory (70 percent) and to goodwill (30 percent). Required: Calculate the balance in each of the following accounts, on the consolidated balance sheet, immediately following the acquisition. a. Current assets b. Noncurrent assets c. Current liabilities. d. Long-term debt e. Stockholders' equity. [END OF…
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