Advanced Accounting
12th Edition
ISBN: 9781305084858
Author: Paul M. Fischer, William J. Tayler, Rita H. Cheng
Publisher: Cengage Learning
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Question
Chapter 2, Problem 3.2E
To determine
Concept Introduction: The amount of
Price below which Gain will be recognized.
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your solution.
The management team of Gee Co. is deciding to acquire Bea Co. an entity that sells
a product that compliments its own product. The management of Bea Co. demands
a price of P18,000,000 for it to agree with the acquisition by Gee Co. Relevant
data gathered for annual operations are as follows:
Gee Co.
Вea Co.
Combined
Average Net Income
Depreciation Expense
3,500,000
2,500,000
6,500,000
250,000
150,000
350,000
WACC
12%
15%
12.50%
Sam wants to purchase Smith, Inc. The following information is available for Smith from the balance sheet
Accounts Receivable
Inventory
Building
Accumulated
Depreciation
View transaction list
250,000
400,000
625,000
(180,000)
The Company estimates that the Accounts Receivable are worth $230,000, the inventory is worth $425,000, and the building is worth $800,000.
Everything else is worth its book value. Sam will pay $1,400,000 for Smith, Record the journal entry for this purchase.
Journal entry worksheet
Note: Enter debits before credits.
What is the journal entry to record the purchase?
Transaction
number
Accounts Payable
Note Payable
Common Stock
Retained Earnings
Account Name
135,000
275,000
400,000
285,000
Debit
Credit
Glen Oaks Chemist Ltd. is located in a small industrial town with two main employers. One of the employers
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Carrying amount at 30/ Net selling price
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5,000
4,000
Delivery vehicle
7,000
5,000
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3,000
2,500
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10,000
25,000
11,500
Chapter 2 Solutions
Advanced Accounting
Ch. 2 - Prob. 1UTICh. 2 - Prob. 2UTICh. 2 - Prob. 3UTICh. 2 - Prob. 4UTICh. 2 - Prob. 5UTICh. 2 - Prob. 6UTICh. 2 - Santos Corporation is considering investing in...Ch. 2 - Prob. 2.1ECh. 2 - Prob. 2.2ECh. 2 - Prob. 3.1E
Ch. 2 - Prob. 3.2ECh. 2 - Prob. 4.1ECh. 2 - Prob. 4.2ECh. 2 - Prob. 4.3ECh. 2 - Prob. 5.1ECh. 2 - Prob. 5.2ECh. 2 - Prob. 6.1ECh. 2 - Prob. 6.2ECh. 2 - Prob. 7.1ECh. 2 - Prob. 7.2ECh. 2 - Prob. 8.1ECh. 2 - Prob. 9.1ECh. 2 - Prob. 9.2ECh. 2 - Prob. 9.4ECh. 2 - Prob. 2A.1AECh. 2 - Prob. 2.1.1PCh. 2 - Prob. 2.1.2PCh. 2 - Prob. 2.2.1PCh. 2 - Prob. 2.2.2PCh. 2 - Prob. 2.2.3PCh. 2 - Prob. 2.3.1PCh. 2 - Prob. 2.3.2PCh. 2 - Prob. 2.3.3PCh. 2 - Prob. 2.4.1PCh. 2 - Prob. 2.4.2PCh. 2 - Prob. 2.4.3PCh. 2 - Prob. 2.5.1PCh. 2 - Prob. 2.5.2PCh. 2 - Prob. 2.5.3PCh. 2 - Prob. 2.6.1PCh. 2 - Prob. 2.6.2PCh. 2 - Prob. 2.7.1PCh. 2 - Prob. 2.7.2PCh. 2 - Prob. 2.8.1PCh. 2 - Prob. 2.8.2PCh. 2 - Prob. 2.9.1PCh. 2 - Prob. 2.9.2PCh. 2 - Prob. 2.10.1PCh. 2 - Prob. 2.11.1PCh. 2 - Prob. 2.12.1PCh. 2 - Prob. 2.12.2PCh. 2 - Prob. 2.13.1PCh. 2 - Prob. 2.13.2PCh. 2 - Prob. 2.14.1PCh. 2 - Prob. 2.14.2PCh. 2 - Prob. 2.15.1PCh. 2 - Prob. 2.15.2PCh. 2 - Prob. 2A.1.1APCh. 2 - Prob. 2A.1.2APCh. 2 - Prob. 2.1.1CCh. 2 - Prob. 2.1.2C
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