Advanced Financial Accounting
12th Edition
ISBN: 9781259916977
Author: Christensen, Theodore E., COTTRELL, David M., Budd, Cassy
Publisher: Mcgraw-hill Education,
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Chapter 7, Problem 7.1.1E
To determine
Concept Introduction:
The intercompany transactions occur when the unit of legal entity is having transactions with another unit of the similar entity. This transaction can be divided into two categories such as direct and indirect intercompany transfer. The direct transfer occurs when there is transfer between the different units of the same entity and indirect transfer occurs when the unit of entity acquires debt or assets issued to unrelated entity through another unit of the same entity. This type of transfer will help the entity in improving the flow of finance and asset in efficient manner.
:
The carrying amount of equipment to be recorded in consolidated
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After the business combination on the basis of full-goodwill approach, what amount of investment in Silk will be reported? (Just use what is given from the information)
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Use the following to answer questions 8 through 10:
On May 1, 2021, Jazzie Co. agreed to sell the assets of its Mister Division to Shawna Inc. for $80 million. The sale was completed on December 31, 2021. Jazzie’s year ends on December 31st. The following additional facts pertain to the transaction:
The Mister Division qualifies as a component of an entity as defined by GAAP.
Mister's net assets totaled $48 million on Jazzie's books at the time of the sale.
Mister incurred a pre-tax operating loss of $10 million in 2021.
Jazzie’s income tax rate is 40%.
In the 2021 income statement for Jazzie Co., they would report after tax income from discontinued operations of:
Group of answer choices
$9.2 million.
$13.2 million.
$22 million.
$26 million.
If PROMDI Co., a new company would acquire the net assets of CARDO Co and SYANO Co. PROMDI Co will be issuing 30,000 shares to CARDO and 12,000 shares to SYANO. The following is the balance sheet of PROMDI Co, followed by the fair values and additional unpaid costs incurred by PROMDI in the acquisition:
REQUIREMENTS:A. GoodwillB. Consolidated Total Assets at the date of acquisitionC. Consolidated Total Liabilities at the date of acquisitionD. Consolidated Equity at the date of acquisition
Chapter 7 Solutions
Advanced Financial Accounting
Ch. 7 - Prob. 7.1QCh. 7 - Prob. 7.2QCh. 7 - Prob. 7.3QCh. 7 - Prob. 7.4QCh. 7 - Prob. 7.5QCh. 7 - Prob. 7.6QCh. 7 - Prob. 7.7QCh. 7 - Prob. 7.8QCh. 7 - Prob. 7.9QCh. 7 - Prob. 7.10Q
Ch. 7 - Prob. 7.11QCh. 7 - Prob. 7.12QCh. 7 - Prob. 7.13QCh. 7 - Prob. 7.14QCh. 7 - Prob. 7.15QCh. 7 - Prob. 7.16QCh. 7 - Prob. 7.17QCh. 7 - Prob. 7.18AQCh. 7 - Prob. 7.1CCh. 7 - Prob. 7.2CCh. 7 - Prob. 7.3CCh. 7 - Prob. 7.4CCh. 7 - Prob. 7.5CCh. 7 - Prob. 7.1.1ECh. 7 - Prob. 7.1.2ECh. 7 - Prob. 7.1.3ECh. 7 - Prob. 7.1.4ECh. 7 - Prob. 7.1.5ECh. 7 - Prob. 7.2.1ECh. 7 - Prob. 7.2.2ECh. 7 - Prob. 7.2.3ECh. 7 - Prob. 7.2.4ECh. 7 - Prob. 7.2.5ECh. 7 - Prob. 7.2.6ECh. 7 - Prob. 7.3ECh. 7 - Prob. 7.4ECh. 7 - Prob. 7.5ECh. 7 - Prob. 7.6ECh. 7 - Prob. 7.7ECh. 7 - Transfer of Depreciable Asset at Year-End Pitcher...Ch. 7 - Prob. 7.9ECh. 7 - Sale of Equipment to Subsidiary in Current Period...Ch. 7 - Prob. 7.11ECh. 7 - Prob. 7.12ECh. 7 - Prob. 7.13ECh. 7 - Prob. 7.14ECh. 7 - Prob. 7.15ECh. 7 - Prob. 7.16ECh. 7 - Prob. 7.17ECh. 7 - Prob. 7.18ECh. 7 - Prob. 7.19ECh. 7 - Prob. 7.20ECh. 7 - Prob. 7.21ECh. 7 - Prob. 7.22ECh. 7 - Prob. 7.23AECh. 7 - Prob. 7.24PCh. 7 - Prob. 7.25PCh. 7 - Prob. 7.26PCh. 7 - Prob. 7.27PCh. 7 - Prob. 7.28.1PCh. 7 - Prob. 7.28.2PCh. 7 - Prob. 7.28.3PCh. 7 - Prob. 7.28.4PCh. 7 - Prob. 7.29PCh. 7 - Prob. 7.30PCh. 7 - Prob. 7.31PCh. 7 - Prob. 7.32PCh. 7 - Prob. 7.33PCh. 7 - Prob. 7.34PCh. 7 - Prob. 7.35PCh. 7 - Prob. 7.37PCh. 7 - Prob. 7.38PCh. 7 - Prob. 7.41AP
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- After the business combination on the basis of full-goodwill approach, what amount of total assets will be reported? (Use only the given information) a. P1,081,000 b. P1,121,000 c. P1,196,500 d. P1,231,500arrow_forwardDetermine the consolidated balances of SALES in the year 20x6.arrow_forwardhow much is the goodwill to be reported on january 31, 2022 ?arrow_forward
- Hoover Company acquired Burgess Company for $1,200,000 cash. The fair value of Burgess's assets was $1,040,000, and the company had liabilities of $60,000. Which of the following journal entries would be used to record the purchase of Burgess Company? Multiple Choice Burgess assets Burgess liabilities Goodwill Cash Burgess assets Cash 1,040,000 60,000 100,000 1,200,000 1,200,000 1,200,000arrow_forwardBox Company (the transferor company) and Cox Company (the transferee company) amalgamate in an exchange of stock to form Cox & Box Company. The pre-amalgamation balance sheets of Cox Company and Box Company are as follows: 1. Вох Сompany Сох Соmpany * in million) (® in million) Fixed assets 25 10.0 Current assets 20 7.5 Total assets Share capital (? 10 face value) Reserves and surplus Debt 45 17.5 20 5 10 10 15 2.5 45 17.5 For each share held in Box Company, two shares of Cox Company were given in exchange (face value: 710, share premium: 720) as the market price of Cox's equity shares is 730. The fair market value of the fixed assets and current assets of Box Company was assessed at ?20 million and 710 million, respectively. Prepare the post-amalgamation balance sheet of Cox & Box Company under the 'pooling' and 'purchase' methods. 000arrow_forwardWhat is the non-controlling Interest in Net Income for the year 20x6? The Non-controlling Interest in Net Assets of Subsidiary for 20x6 should be?arrow_forward
- Required information (The folowing information applies to the questions displayed below.] Pumpworks Inc. and Seaworthy Rope Company agreed to merge on January 1, 20X3. On the date of the merger agreement, the companies reported the following data: Seaworthy Rope Company Book Value Pumpworks Fair Balance Sheet Items Assets Cash & Receivables Inventory Land Plant & Equipment Less: Accumulated (131,000) Depreciation Total Assets$ 601,000 Liabilities & Equities Current Liabilities Fair Value Book Value Value $ 189,000 $109,000 $ 19,000 $ 19,000 107,000 107,000 168,000 160,000 29,000 9,000 41,000 14,000 409,000 309,000 219,000 123,000 picture picture (71,000) $746,000 $205,000 $197,000 $ 77,000 $ 77,000 $ 28,000 $ 28,000 Capital Stock Capital in Excess of 327,000 73,500 22,000 7,000 Par Value Retained Earnings Total Liabilities $ 601,000 & Equities 175,000 96,500 $205,000 Pumpworks has 10,900 shares of its $30 par value shares outstanding on January 1, 20X3, and Seaworthy has 4,900 shares…arrow_forwardAfter the business combination on the basis of full-goodwill approach, what amount of liabilities will be reported? a. P265,000 b. P436,500 c. P622,000 d. P701,500arrow_forwardWhat is the consolidated sales for the year 20x6?arrow_forward
- Please show the complete solution or step by step how did you come up with the answer.arrow_forwardUpvote will be given. Write the complete solutions legibly and solve it manually. Final answers are: 1. 4,212,500 2. 9,212, 500arrow_forwardPrepare and compute for the CONSOLIDATED TOTAL ASSETS at the date of acquisition.arrow_forward
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