Soft Bound Version for Advanced Accounting 13th Edition
Soft Bound Version for Advanced Accounting 13th Edition
13th Edition
ISBN: 9781260110579
Author: Hoyle
Publisher: McGraw Hill Education
Question
Book Icon
Chapter 4, Problem 36P

a.

To determine

Explain the way in which the accountant determines that the parent has applied the initial value method.

b.

To determine

Find the annual excess amortization initially recognized in connection with this acquisition.

c.

To determine

Find the investment income which the parent would have recorded in 2018 if the parent had applied the equity method.

D

To determine

Find the amount which the parent should report as retained earnings in its January 1, 2018, consolidated balance sheet.

e.

To determine

Find the consolidated net income for 2018 and what amounts are attributable to the controlling and non-controlling interests.

f.

To determine

Find the balance which is included for the subsidiary’s Buildings account.

g.

To determine

Find the consolidated Buildings reported balance as of December 31, 2018.

Blurred answer
Students have asked these similar questions
Nascent, Inc., acquires 60 percent of Sea-Breeze Corporation for $414,000 cash on January 1, 2018. The remaining 40 percent of the Sea-Breeze shares traded near a total value of $276,000 both before and after the acquisition date. On January 1, 2018, Sea-Breeze had the following assets and liabilities:     Book Value   Fair Value Current assets $ 150,000     $ 150,000   Land   200,000       200,000   Buildings (net) (6-year remaining life)   300,000       360,000   Equipment (net) (4-year remaining life)   300,000       280,000   Patent (10-year remaining life)   0       100,000   Liabilities   (400,000 )     (400,000 )     The companies’ financial statements for the year ending December 31, 2021, follow:     Nascent   Sea-Breeze Revenues $ (600,000 )   $ (300,000 ) Operating expenses   410,000       210,000   Investment income   (42,000 )     0   Net income $ (232,000 )   $ (90,000 ) Retained earnings, 1/1/21 $ (700,000 )   $ (300,000 ) Net income…
Nascent, Inc., acquires 60 percent of Sea-Breeze Corporation for $414,000 cash on January 1, 2018. The remaining 40 percent of the Sea-Breeze shares traded near a total value of $276,000 both before and after the acquisition date. On January 1, 2018, Sea-Breeze had the following assets and liabilities:     Book Value   Fair Value Current assets $ 150,000     $ 150,000   Land   200,000       200,000   Buildings (net) (6-year remaining life)   300,000       360,000   Equipment (net) (4-year remaining life)   300,000       280,000   Patent (10-year remaining life)   0       100,000   Liabilities   (400,000 )     (400,000 )     The companies’ financial statements for the year ending December 31, 2021, follow:     Nascent   Sea-Breeze Revenues $ (600,000 )   $ (300,000 ) Operating expenses   410,000       210,000   Investment income   (42,000 )     0   Net income $ (232,000 )   $ (90,000 ) Retained earnings, 1/1/21 $ (700,000 )   $ (300,000 ) Net income…
Peer, Inc. acquires 75 percent of Sea-breeze Corporation for P600,000 cash on January 1, 2016. The remaining  percent of the Sea-breeze shares traded near a total value of 200,000 both before and after the acquisition date. NCI is measured on a full basis .On January 1, 2016, Sea-breeze had the following assets and liabilities:   Book Value Fair Value Current Assets P 250,000 P 250,000 Land 100,000 100,000 Building (net) – 5-year-year life 400,000 350,000 Equipment (net) – 8-year life 300,000 400,000 Patent (10-year life) -0- 50,000 Accounts Payable (200,000) (200,000) Bonds Payable  – 5-years (150,000) (175,000) Net P 700,000 P 775,000 Common Stock P 650,000   Retained Earnings P   50,000   The companies’ financial statements for the year ending December 31, 2016 using cost method are as follows:   Peer Sea-Breeze Revenue P (800,000) P (250,000) Operating expenses…
Knowledge Booster
Background pattern image
Similar questions
SEE MORE QUESTIONS
Recommended textbooks for you
Text book image
Auditing: A Risk Based-Approach (MindTap Course L...
Accounting
ISBN:9781337619455
Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:Cengage Learning
Text book image
Cornerstones of Financial Accounting
Accounting
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Cengage Learning
Text book image
Auditing: A Risk Based-Approach to Conducting a Q...
Accounting
ISBN:9781305080577
Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:South-Western College Pub