Concept explainers
Consolidated statement of cash flow:consolidated entities, as with individual companies, must present a statement of cash flow when they issue a complete set of financial statements. A consolidated statement of
Requirement 1
the amount of dividends paid by J in 20X2
b.
Consolidated statement of cash flow: consolidated entities, as with individual companies, must present a statement of cash flow when they issue a complete set of financial statements. A consolidated statement of cash flows is similar to a statement of cash flows prepared for an individual corporate entity and is prepared in same manner. Consolidated statement of cash flow is prepared after consolidated financial statement. Consolidated cash flow statement is prepared form the information in the three consolidated statements, when an indirect approach is used consolidated net income must be adjusted for all items that affect consolidated net income and the cash of consolidated entity effectively.
Requirement 2
To explain:why amortization of bond premium is treated as deduction from net income to determine net cash flow from operating activities.
c.
Consolidated statement of cash flow: consolidated entities, as with individual companies, must present a statement of cash flow when they issue a complete set of financial statements. A consolidated statement of cash flows is similar to a statement of cash flows prepared for an individual corporate entity and is prepared in same manner. Consolidated statement of cash flow is prepared after consolidated financial statement. Consolidated cash flow statement is prepared form the information in the three consolidated statements, when an indirect approach is used consolidated net income must be adjusted for all items that affect consolidated net income and the cash of consolidated entity effectively.
Requirement 3
To explain: why increase in
d.
Consolidated statement of cash flow: consolidated entities, as with individual companies, must present a statement of cash flow when they issue a complete set of financial statements. A consolidated statement of cash flows is similar to a statement of cash flows prepared for an individual corporate entity and is prepared in same manner. Consolidated statement of cash flow is prepared after consolidated financial statement. Consolidated cash flow statement is prepared form the information in the three consolidated statements, when an indirect approach is used consolidated net income must be adjusted for all items that affect consolidated net income and the cash of consolidated entity effectively.
Requirement 4
To explain : why dividends to non-controlling stockholders are not shown as dividends payment in the
e.
Consolidated statement of cash flow: consolidated entities, as with individual companies, must present a statement of cash flow when they issue a complete set of financial statements. A consolidated statement of cash flows is similar to a statement of cash flows prepared for an individual corporate entity and is prepared in same manner. Consolidated statement of cash flow is prepared after consolidated financial statement. Consolidated cash flow statement is prepared form the information in the three consolidated statements, when an indirect approach is used consolidated net income must be adjusted for all items that affect consolidated net income and the cash of consolidated entity effectively.
Requirement 5
did the loss on sale of equipment included in the consolidated statement of cash flows result from a sale to an affiliate or non-affiliate.
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Chapter 10 Solutions
Advanced Financial Accounting
- Bean Corporation purchased 17% of the outstanding shares of common stock of Williams Corporation as a long-term investment. Subsequently, Williams Corporation reported net income and declared and paid cash dividends. What journal entry would Bean Corporation use to record the purchase of Williams Corporation common stock? debit Investment--Williams Corporation; credit Income of Williams Corporation debit Cash; credit Investment--Williams Corporation debit Cash: credit Dividend Revenue Odebit Investment--Williams Corporation; credit Casharrow_forwardGodoarrow_forwardAssume that Company A acquires 70 per cent of Company B for a cash price of $14 million when the share capital and reserves of Company B are: Share capital$8 millionRetained earnings$2 million $10 millionPass the necessary consolidation journal entries and the journal entries to record the non-controlling interest if the non-controlling interest in the acquirer is measured at the non-controlling interest’s proportionate share of the acquiree’s identifiable net assetsarrow_forward
- Question: How much is the total share of Aubrey in the profit for the period?arrow_forwardPrepare and compute for the CONSOLIDATED EQUITY at the date of acquisition.arrow_forwardIf CARDO Co purchases the net assets of SYANO Co by issuing 5,000 shares of their P20 par valueshares with a fair value of P40 per share, incurs a mortgage loan for P90,000, pays P150,000 cash andpaying direct, indirect and stock issue costs of P75,000, P50,000 and P40,000 respective. REQUIREMENTS:A. GoodwillB. Consolidated Total Assets at the date of acquisitionarrow_forward
- I can find the values for the equity and investment asset credits/debitsarrow_forwardQq.1.arrow_forwardPrecedent Transaction Analysis: Olive Company Inc. purchased Canine-Safe Chocolate Inc. and details of the transaction are below: • $30 per share for Canine-Safe Chocolate Inc.'s 520,000 diluted shares outstanding (No calculations needed for dilution effect) • $6 million in cash • Olive Company Inc. will take on all of Canine-Safe Chocolate Inc.'s debt totaling $10 million • Canine-Safe Chocolate Inc.'s EBITDA is $2 million What is the transaction EBITDA Multiple?arrow_forward
- If CARDO Co purchases the net assets of SYANO Co by issuing 5,000 shares of their P20 par valueshares with a fair value of P40 per share, incurs a mortgage loan for P90,000, pays P150,000 cash andpaying direct, indirect and stock issue costs of P75,000, P50,000 and P40,000 respective.REQUIREMENTS: Goodwill and Consolidated Total Assets at the date of acquisitionarrow_forwardThe balance sheet of the proprietorship of Jacob as of June 30, 2018 showed the following assets andliabilities:Cash P 40,000Accounts Receivable 53,600Inventory 88,000Equipment 65,600Accounts Payable 63,520The cash balance included a 200- share certificate of BW Resources common at acquisition cost of P 1,600; the current market quotation is 70 per share. Of the accounts receivable, an estimated 5% is considered to be doubtful of collection. Certain inventory items, booked at a cost of P22,960, are currently worth P16,000. Depreciation has not been recorded; the equipment, acquired two years ago, has a remaining useful life of about eight more years. Prepaid expense of P 12,800 and accrued expense of P 6,120 have not been properly recognized. Emily and Bert will join Jacob in a partnership. Jacob will invest the net assets of his business, after effecting the appropriate adjustments, and he will be allowed credit for goodwill equal to 10% of his initial capital credit. Emily and Bert…arrow_forwardProblem 3) On January 1, 20X7, Falcon acquired the net assets of Intra for $3,400,000 with the issue of shares. The statement of financial position for Intra at the date of acquisition is shown below, together with estimates of the fair values of Intra's recorded assets and liabilities. Intra Corp Statement of Financial Position as at December 31, 20X6 Assets Cash Accounts receivable Inventories Property, plant, and equipment Development projects Other investments Total assets Liabilities Accounts payable and accrued liabilities Long-term debt Common shares Retained earnings Total liabilities and shareholders' equity Book value $ 000's 350 180 330 3,465 150 20 4,495 180 680 1,525 2,110 4,495 Fair value $ 000's 350 170 310 3,155 565 45 180 660 Required: a) What is the amount of goodwill to be recorded for this business combination? b) Prepare the journal entry that Falcon will use to record the business combination. Prepare the statement of financial position for Intra on January 1,…arrow_forward
Auditing: A Risk Based-Approach to Conducting a Q...AccountingISBN:9781305080577Author:Karla M Johnstone, Audrey A. Gramling, Larry E. RittenbergPublisher:South-Western College Pub