Show your work GoogleAmizoneAmQ6 Odd Lld acquired the entire equity sharo capital of Even Ltd on 1st January 2019 for a consideration ofRs. 600 million Al the time of acqusition, the share capital of Even Lid consisted of 20 million oqutyshares of Rs 10 each The company had reserve and surplus amounting to Rs 560 milionThe Balance Sheets of the two companies as on 31st March, 2019 are given belowOdd Lid. (Rs. In million)Even Ltd. (Rs. In million)Liabilities:Share CapitalReserve and SurplusLoan Funds500254032002007501400CreditorsTotal165078906803030Assets:Fixed AssetsInvestmentsInventories143065092510063025801260320560DebtorsLoans and AdvancesOther Assets134078901659603030TotalAdditional Information:1. Even Ltd borTowed Rs 1000 million from Odd Ltd on 1st April 2019 at 10% per annum. The loanamount and interest thereon are due to be paid.2 Odd Ltd. bought goods from Even Ltd for Rs 200 million during the year. Even Lid charged a marginof 25% on cost Out of these goods, 1/4th is still unsold3. The debtors for Even Ltd include an amount of Rs. 140 million receivables from Odd LtdYou are required to prepare consolidated balance sheet.

Purchase consideration: Rs. 600 million Net assets acquired from Even Ltd: Equity share capital +…

Amizone Q6 Odd Lid acquired the entire oquity shao capital of Evon Ltd on 1st January 2019 for a consideration of Rs 600 million Al the time of acqurtion, the share capitai of Even Lid consisted of 20 milion oqaty shares of Rs 10 each The company had reserve and surpks amounting to Rs 560 milon The Balance Sheets of the two companies as on 31st March, 2019 are given below Odd Lid. (Rs. In million) Even Ltd. (Rs. In million) Liabilities: Share Capital Reserve and Suplus Loan Funds Creditors 500 200 2540 750 1400 680 3030 3200 1650 Total 7890 Assets: FIxed Assets Investments Inventones Debtors Loans and Advances Other Assets Total 1430 650 630 2580 925 100 320 560 1260 1340 7890 165 960 3030 Additional Information: 1. Even Lid borrowed Rs 1000 milion from Odd Ltd on 1st April 2019 at 10% per annum The loan amount and interest thereon are due to be paid 2 Odd Lid bought goods from Even Lid for Rs 200 million during the yoar. Even Lid charged a margin of 25% on cost Out of these goods, 1/4th is still unsold 3. The debtors for Even Lid incude an amount of Rs. 140 milion receivables from Odd Lid You are required to prepare consolidated balance sheet.

Amizone Q6 Odd Lid acquired the entire oquity shao capital of Evon Ltd on 1st January 2019 for a consideration of Rs 600 million Al the time of acqurtion, the share capitai of Even Lid consisted of 20 milion oqaty shares of Rs 10 each The company had reserve and surpks amounting to Rs 560 milon The Balance Sheets of the two companies as on 31st March, 2019 are given below Odd Lid. (Rs. In million) Even Ltd. (Rs. In million) Liabilities: Share Capital Reserve and Suplus Loan Funds Creditors 500 200 2540 750 1400 680 3030 3200 1650 Total 7890 Assets: FIxed Assets Investments Inventones Debtors Loans and Advances Other Assets Total 1430 650 630 2580 925 100 320 560 1260 1340 7890 165 960 3030 Additional Information: 1. Even Lid borrowed Rs 1000 milion from Odd Ltd on 1st April 2019 at 10% per annum The loan amount and interest thereon are due to be paid 2 Odd Lid bought goods from Even Lid for Rs 200 million during the yoar. Even Lid charged a margin of 25% on cost Out of these goods, 1/4th is still unsold 3. The debtors for Even Lid incude an amount of Rs. 140 milion receivables from Odd Lid You are required to prepare consolidated balance sheet.

Financial Accounting

14th Edition

ISBN:9781305088436

Author:Carl Warren, Jim Reeve, Jonathan Duchac

Publisher:Carl Warren, Jim Reeve, Jonathan Duchac

Chapter15: Investments And Fair Value Accounting

Section: Chapter Questions

Problem 2E

See similar textbooks

Similar questions

Hamilton Companys balance sheet on January 1, 2019, was as follows: Korbel Company is considering purchasing Hamilton (a privately held company) and discovers the following about Hamilton: a. No allowance for doubtful accounts has been established. A 10,000 allowance is considered appropriate. b. Marketable securities are valued at cost. The current market value is 60,000. c. The LIFO inventory method is used. The FIFO inventory of 140,000 would be used if the company is acquired. d. Land, included in property, plant, and equipment, which is recorded at its cost of 50,000, is worth 120,000. The remaining property, plant, and equipment is worth 10% more than its depreciated cost. e. The company has an unrecorded trademark that is worth 70,000. f. The companys bonds are currently trading for 130,000. g. The pension liability is understated by 40,000. Required: 1. Compute the amount of goodwill if Korbel agrees to pay 500,000 cash for Hamilton. 2. Next Level What are the reasons that the book value of Hamiltons net identifiable assets differ from their market value? 3. Prepare the journal entry to record the acquisition on the books of Korbel assuming Hamilton is liquidated. 4. If Korbel agrees to pay only 400,000 cash, how much goodwill exists? 5. If Korbel pays only 400,000 cash, prepare the journal entry to record the acquisition on its books, assuming Hamilton is liquidated.
Otter Tail, Inc., began operations in January 2015 and had the following reported net income or loss for each of its 5 years of operations: At December 31, 2019, Otter Tails capital stock was comprised of the following: Otter Tail has never paid a cash or stock dividend. There has been no change in the capital accounts since Otter Tail began operations. The appropriate state law permits dividends only from retained earnings. Required: Prepare a worksheet showing the maximum amount available for cash dividends on December 31, 2019, and how it would be distributable to the holders of the common shares and each of the preferred shares. Show supporting computations in good form.
Investments On October 4, 2019, Collins Company purchased 100 bonds of Steph Company for 6,400 as a short-term investment in securities classified as available for sale. On December 31, 2019, the bonds had a fair value of 6,300, and on February 8, 2020, Collins sold the bonds for 6,700. Required: In journal entry form, prepare the spreadsheet entries to record these transactions for Collins Companys 2019 and 2020 statement of cash flows.
1. On 1 January 2019, Pitty Ltd purchased 30% of the shares in Annah Ltd for P700, 000. At this date, Annah Ltd's net assets stood at P1, 4m. At 31 December 2019, Annah Ltd has net assets of P1, 5m. Pitty Ltd sold goods worth P160, 000 to Annah Ltd at a margin of 25%. Half of the goods remained in inventory at the year-end. Calculate the value of the investment in associate as at 31 December 2019?
4. On January 1, 2019, Lallo Company purchased 15% of Vintar Company’s ordinary shares for P20,000,000. The following data concerning Vintar Company are available: 2019 2020 Net income P6,000,000 P7,000,000 Cash dividend paid None 15,000,000 In its income statement for the year ended December 31, 2020, how much should Lallo report as income from this investment? Group of answer choices P1,950,000 P600,000 P700,000 P2,250,000
) Ziek Corp. acquired a 30% interest in ZKI Corporation on December 31, 2020 for $2,159,000. During 2021, ZKI had net income of $864,000 and paid cash dividends of $605,000. At December 31, 2021, what should be the balance in the Investment in ZKI account? (A 36) O $77,700 O $2,159,000 O $2,236,700 O $2,599,700
Trump Ltd acquired all the assets and liabilities of Bush Ltd on 30 June 2020. The purchase consideration was as follows: $1,000,000 in cash paid on the acquisition date Two shares in Trump Ltd for every one share in Bush Ltd. Bush Ltd has 2,000,000 shares on the issue on 30 June 2020. On 30 June 2013 Trump Ltd shares were quoted on the ASX at $2.50 per share. Deferred payment of $500,000 to be paid on 30 June 2014. Trump Ltd’s cost of capital is 7% which represents a one-period present value factor of 0.9346 Should the price of Trump Ltd shares fall below $2.50 in the six months following the acquisition Trump Ltd is required to pay a cash contingent consideration? It is estimated that there is a 60% probability that the share price will fall to $2.45 in this period. Other information Trump Ltd incurred legal and other costs associated with the acquisition of $10,000 Trump Ltd incurred share issue costs of $4,000 The assets and liabilities acquired from Bush Ltd are as…
On January 2, 2020, Theodora Company purchased 40,000 shares of Byzantine, Inc. stock at P100 per share. Brokerage fees amounted to P120,000. A P5 dividend per share of Byzantine, Inc. shares had been declared on December 15, 2019, to be paid on March 31, 2020 to shareholders of record on January 31, 2020. The shares are designated as FVTOCI. On December 31, 2020 the investment has a fair value of P4.200.000. How much should be recognized in the 2020 other comprehensive income related to these securities? A. 80,000 B. 200,000 C. 280,000 D. 400,000
Trump Ltd acquired all the assets and liabilities of Bush Ltd on 30 June 2020. The purchase consideration was as follows: $1,000,000 in cash paid on acquisition date Two shares in Trump Ltd for every one share in Bush Ltd. Bush Ltd has 2,000,000 shares on issue at 30 June 2020. At 30 June 2013 Trump Ltd shares were quoted on the ASX at $2.50 per share. A deferred payment of $500,000 to be paid on 30 June 2014.Trump Ltd’s cost of capital is 7% which represents a one period present value factor of 0.9346 Should the price of Trump Ltd shares fall below $2.50 in the six months following the acquisition Trump Ltd is required to pay a cash contingent consideration. It is estimated that there is a 60% probability that the share price will fall to $2.45 in this period. Other information Trump Ltd incurred legal and other costs associated with the acquisition of $10,000 Trump Ltd incurred share issue costs of $4,000 The assets and liabilities acquired from Bush Ltd are as follows:…
Trump Ltd acquired all the assets and liabilities of Bush Ltd on 30 June 2020. The purchase consideration was as follows: • $1,000,000 in cash paid on acquisition date • Two shares in Trump Ltd for every one share in Bush Ltd. Bush Ltd has 2,000,000 shares on issue at 30 June 2020. At 30 June 2013 Trump Ltd shares were quoted on the ASX at $2.50 per share. • A deferred payment of $500,000 to be paid on 30 June 2014.Trump Ltd’s cost of capital is 7% which represents a one period present value factor of 0.9346 • Should the price of Trump Ltd shares fall below $2.50 in the six months following the acquisition Trump Ltd is required to pay a cash contingent consideration. It is estimated that there is a 60% probability that the share price will fall to $2.45 in this period. Other information - Trump Ltd incurred legal and other costs associated with the acquisition of $10,000 - Trump Ltd incurred share issue costs of $4,000 The assets and liabilities acquired from Bush Ltd are as…