mid sem corporate accounting

(a) On 1 January 2023, the LW Group purchased 90% of the 3.75m £1 equity share capital of JL Ltd. The costs incurred by LW Group at the date of acquisition were as follows: Cash paid on 1 January 2023 Professional fees Bank fees and charges associated with the acquisition £'000 124,800 850 1,000 In addition to the costs shown above, LW issued 15,000,000 25p ordinary shares to the shareholders of JL Ltd as part of the consideration. As at 1 January 2023 the market value of LW shares were £1.50 each and JL Ltd shares were valued at £1.20 each. LW will also pay a further £5,000,000 in cash on 1 January 2024. An appropriate discount rate is 7%. A further 2,000,000 shares will be issued by LW to the shareholders of JL Ltd on 1 January 2024 if profits increase by 5% over the next 12 months. The directors believe there is a 60% likelihood of the contingent consideration being achieved and that the market value of LW shares are expected to rise to £1.80 each. A due diligence report indicates…

QUESTION 18 On January 1, 20X9, Pirate Corporation acquired 80 percent of Sea-Gull Company's common stock for $160,000 cash. The fair value of the noncontrolling interest at that date was determined to be $40,000. Data from the balance sheets of the two companies included the following amounts as of the date of acquisition:    Pirate Corp. Sea-Gull Corp. Cash   $ 60,000       $ 20,000     Accounts Receivable     80,000         30,000     Inventory     90,000         40,000     Land     100,000         40,000     Buildings and Equipment     200,000         150,000     Less: Accumulated Depreciation     (80,000 )       (50,000 )   Investment in Sea-Gull Corp.     160,000               Total Assets   $ 610,000       $ 230,000                           Accounts Payable   $ 110,000       $ 30,000     Bonds Payable     95,000         40,000     Common Stock     200,000         40,000     Retained Earnings     205,000         120,000     Total Liabilities…

QUESTION 19 On January 1, 20X9, Pirate Corporation acquired 80 percent of Sea-Gull Company's common stock for $160,000 cash. The fair value of the noncontrolling interest at that date was determined to be $40,000. Data from the balance sheets of the two companies included the following amounts as of the date of acquisition:    Pirate Corp. Sea-Gull Corp. Cash   $ 60,000       $ 20,000     Accounts Receivable     80,000         30,000     Inventory     90,000         40,000     Land     100,000         40,000     Buildings and Equipment     200,000         150,000     Less: Accumulated Depreciation     (80,000 )       (50,000 )   Investment in Sea-Gull Corp.     160,000               Total Assets   $ 610,000       $ 230,000                           Accounts Payable   $ 110,000       $ 30,000     Bonds Payable     95,000         40,000     Common Stock     200,000         40,000     Retained Earnings     205,000         120,000     Total Liabilities…

QUESTION 17 On January 1, 20X9, Pirate Corporation acquired 80 percent of Sea-Gull Company's common stock for $160,000 cash. The fair value of the noncontrolling interest at that date was determined to be $40,000. Data from the balance sheets of the two companies included the following amounts as of the date of acquisition:    Pirate Corp. Sea-Gull Corp. Cash   $ 60,000       $ 20,000     Accounts Receivable     80,000         30,000     Inventory     90,000         40,000     Land     100,000         40,000     Buildings and Equipment     200,000         150,000     Less: Accumulated Depreciation     (80,000 )       (50,000 )   Investment in Sea-Gull Corp.     160,000               Total Assets   $ 610,000       $ 230,000                           Accounts Payable   $ 110,000       $ 30,000     Bonds Payable     95,000         40,000     Common Stock     200,000         40,000     Retained Earnings     205,000         120,000     Total Liabilities…

QUESTION 21 On January 1, 20X9, Pirate Corporation acquired 80 percent of Sea-Gull Company's common stock for $160,000 cash. The fair value of the noncontrolling interest at that date was determined to be $40,000. Data from the balance sheets of the two companies included the following amounts as of the date of acquisition:    Pirate Corp. Sea-Gull Corp. Cash   $ 60,000       $ 20,000     Accounts Receivable     80,000         30,000     Inventory     90,000         40,000     Land     100,000         40,000     Buildings and Equipment     200,000         150,000     Less: Accumulated Depreciation     (80,000 )       (50,000 )   Investment in Sea-Gull Corp.     160,000               Total Assets   $ 610,000       $ 230,000                           Accounts Payable   $ 110,000       $ 30,000     Bonds Payable     95,000         40,000     Common Stock     200,000         40,000     Retained Earnings     205,000         120,000     Total Liabilities…

QUESTION 20 On January 1, 20X9, Pirate Corporation acquired 80 percent of Sea-Gull Company's common stock for $160,000 cash. The fair value of the noncontrolling interest at that date was determined to be $40,000. Data from the balance sheets of the two companies included the following amounts as of the date of acquisition:    Pirate Corp. Sea-Gull Corp. Cash   $ 60,000       $ 20,000     Accounts Receivable     80,000         30,000     Inventory     90,000         40,000     Land     100,000         40,000     Buildings and Equipment     200,000         150,000     Less: Accumulated Depreciation     (80,000 )       (50,000 )   Investment in Sea-Gull Corp.     160,000               Total Assets   $ 610,000       $ 230,000                           Accounts Payable   $ 110,000       $ 30,000     Bonds Payable     95,000         40,000     Common Stock     200,000         40,000     Retained Earnings     205,000         120,000     Total Liabilities…

E3.5 Acquisition analysis, including fair value adjustment for plant and equipment (Section 3.6.2) On 1 October 20XO, EF Ltd acquired all the issued ordinary shares of GH Ltd. The terms of the acquisition agreement specified that EF Ltd must pay the existing shareholders of GH Ltd $1.5million immediately and a further $1.5million on 30 September 20X1. The incremental cost of short-term finance to EF Ltd is 10% p.a. At acquisition date, the issued capital and reserves of GH Ltd were as follows: Issued capital 1 200000 Retained eamings 1/10/20X0 1400000 At 1 October 20xO, the plant and equipment of GH Ltd had a carrying amount that was $150000 less than its fair value. The company income tax rate is 30%. REQUIRED (a) Prepare the general journal entries for the accounting records of EF Ltd to record: (i) the investment in GH Ltd on 1 October 20X0 (ii) the cash payment of the $1500 000 on 30 September 20X1.

1. Breakspear Co purchased 600,000 of the voting equity shares of Fleet Co when the value of the non-controlling interest in Fleet Co is £150,000. The following information relates to Fleet at the acquisition date. At acquisition £'000 Share capital, £0.5 ordinary shares Retained earnings Revaluation surplus The goodwill arising on acquisition is £70,000. What was the consideration paid by Breakspear Co for the investment in Fleet Co? 500 150 50 700 a) £420,000 b) £770,000 c) £620,000 d) £570,000 K

Question-4 H Ltd acquired 80% of S Ltd several years ago for Rs. 30 million. The balance on S Ltd's retained earnings was Rs. 5,000,000 at the date of acquisition. H Ltd's policy is to measure non-controlling interest at the date of acquisition as a proportionate share of net assets. The draft statements of financial position of the two companies at 31 December 20X1 are: H (Rs. 000) 45,000 30,000 28,000 103,000 Non-current assets: Property, plant and equipment Investment in S Current assets Total assets Equity Share capital Retained earnings Non-current liabilities Current liabilities Total equity and liabilities 5,000 76,000 81,000 2,000 20,000 103,000 Required: Prepare a consolidated statement of financial position as at 31 December 20X1. S (Rs. 000) 15,000 12,000 27,000 1,000 10,000 11,000 6,000 10,000 27,000

PROBLEM VII On July 1, 2019, Eya Company acquired 700,000 shares of Agas Company at a price of P13 per share. Eya estimated that the price paid include P1.50 premium in order to gain control over Agas. On this date, the fair values of Agas' identifiable assets and liabilities and their carrying values are given below: Book Value P2,000,000 9,000,000 P3,000,000 5,000,000 3,000,000 Fair Value P2,000,000 11,000,000 Current assets Property, plant and equipment Liabilities Ordinary shares, P5 par Retained earnings 1. Determine the amount of goodwill.

Q1 Mcgregor Plc acquired 75% of the issued share capital and voting rights of Tavernier Ltd on 1 January 2020. The consolidated cost of sales of Mcgregor Pic and its subsidiary undertaking for the year ended 31 December 2021, before taking into account any adjustments required in respect of the information below, is £395,000. During the year Mcgregor Plc sold goods to Tavernier Ltd for £130,000. 70% of these goods still remain in inventories at the end of the year. The goods were sold at a mark-up of 25% on cost. What is the consolidated cost of sales for the year ending 31 December 2021? A £283,200 B £278,650 C £287,750 D £246,800

QUESTION 25 On January 3, 20X9, Pleat Company acquired 80 percent of Stitch Corporation's common stock for $344,000 in cash. At the acquisition date, the book values and fair values of Stitch's assets and liabilities were equal, and the fair value of the noncontrolling interest was equal to 20 percent of the total book value of Stitch. The stockholders' equity accounts of the two companies at the acquisition date are:   Pleat Stitch Common Stock ($5 par value) $ 500,000   $ 200,000   Additional Paid-In Capital   300,000     80,000   Retained Earnings   350,000     150,000   Total Stockholders' Equity $ 1,150,000   $ 430,000   Noncontrolling interest was assigned income of $11,000 in Pleat's consolidated income statement for 20X9.Based on the preceding information, what is the total stockholders' equity in the consolidated balance sheet as of January 3, 20X9?     $1,236,000     $1,150,000     $1,580,000     $1,064,000

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QUESTION 24 On January 3, 20X9, Pleat Company acquired 80 percent of Stitch Corporation's common stock for $344,000 in cash. At the acquisition date, the book values and fair values of Stitch's assets and liabilities were equal, and the fair value of the noncontrolling interest was equal to 20 percent of the total book value of Stitch. The stockholders' equity accounts of the two companies at the acquisition date are:   Pleat Stitch Common Stock ($5 par value) $ 500,000   $ 200,000   Additional Paid-In Capital   300,000     80,000   Retained Earnings   350,000     150,000   Total Stockholders' Equity $ 1,150,000   $ 430,000   Noncontrolling interest was assigned income of $11,000 in Pleat's consolidated income statement for 20X9.Based on the preceding information, what will be the amount of net income reported by Stitch Corporation in 20X9?     $44,000     $66,000     $36,000     $55,000

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Question 1 Laduan Co is the parent company of a group undergoing rapid expansion through acquisition. Laduan Co has acquired a subsidiary Jaya Co. The current financial year end is 30 June 20X8. Laduan Co acquired 60% of the 10 million equity shares of Jaya Co on 1 July 20X7. Two Laduan Co shares are to be issued for every five shares acquired in Jaya Co. These shares will be issued on 1 July 20X8. The fair value of a Laduan Co share was RM30 at 1 July 20X7. Jaya Co had previously granted a share-based payment to its employees with a three-year vesting period. At 1 July 20X7, the employees had completed their service period but had not yet exercised their options. The fair value of the options granted at 1 July 20X7 was RM15 million. As part of the acquisition, Laduan Co is obliged to replace the share-based payment scheme of Jaya Co with a scheme of its own which has the following details: Laduan Co issued 100 options to each of Jaya Co's 10,000 employees on 1 July 20X7. The shares…

Assume that Bailey Company gains control of Moloney, its subsidiary, with the purchase of a 30% interest paid in cash. The Equity Investment account reports a balance of $250,000 on the acquisition date and represents a 40% interest in Moloney. The total value of Moloney on the acquisition date is $700,000 (assume no premium for control).   The journal entry to record the acquisition includes: Select one: A. Cash, credit, $700,000 B. Gain on revaluation of Moloney, credit, $30,000 C. Loss on revaluation of Moloney, debit, $30,000 D. None of the above PreviousSave AnswersNext

L2-4 Awe Company pays CU500,000,000 for a 30% interest in Groy Company on July 1, 19x2 when the book value of Groy Company's net assets equals fair value. Awe Company amortizes any goodwill from this investment over 20 years. Information related to Groy Company is as follows:   31 Desember 19x1 31 Desember 19x2 Share capital, nominal IDR 1,000 Rp600.000.000 Rp600.000.000 Retained earning 400.000.000 500.000.000 Total Shareholders' Equity 1.000.000.000 1.100.000.000 Net profit earned during the year 19x2   200.000.000 Dividend for the year 19x2 (paid on March 1 of Rp. 50,000,000 and September 1 of Rp. 50,000,000)   100.000.000 Required: calculate Awe Company's revenue from Groy Company for the year 19x2