D) On January 1, P-Corporation and S-Corporation had condensed balance sheets as follows: Park Strand Current assets $ 70,000 $20,000 Noncurrent assets 90,000 40,000 Total assets .. $160,000 $60,000 Current liabilities $ 30,000 $10,000 Long-term debt. Stockholders' equity . . 50,000 80,000 50,000 Total liabilities and equities . $160,000 $60,000 On January 2, P-co borrowed $60,000 and used the proceeds to obtain 80 percent of the outstanding common shares of Strand. The acquisition price was considered proportionate to S-co's total fair value. The $60,000 debt is payable in 10 equal annual principal payments, plus interest, beginning December 31. The excess fair value of the investment over the underlying book value of the acquired net assets is allocated to inventory (60 percent) and to goodwill (40 percent). Required: Calculate the amount of the following consolidated balance sheet items as of January 2, i. Current assets and Noncurrent assets, separately: i. Current liabilities, Noncurrent liabilities &Stockholders' equity.
D) On January 1, P-Corporation and S-Corporation had condensed balance sheets as follows: Park Strand Current assets $ 70,000 $20,000 Noncurrent assets 90,000 40,000 Total assets .. $160,000 $60,000 Current liabilities $ 30,000 $10,000 Long-term debt. Stockholders' equity . . 50,000 80,000 50,000 Total liabilities and equities . $160,000 $60,000 On January 2, P-co borrowed $60,000 and used the proceeds to obtain 80 percent of the outstanding common shares of Strand. The acquisition price was considered proportionate to S-co's total fair value. The $60,000 debt is payable in 10 equal annual principal payments, plus interest, beginning December 31. The excess fair value of the investment over the underlying book value of the acquired net assets is allocated to inventory (60 percent) and to goodwill (40 percent). Required: Calculate the amount of the following consolidated balance sheet items as of January 2, i. Current assets and Noncurrent assets, separately: i. Current liabilities, Noncurrent liabilities &Stockholders' equity.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter21: The Statement Of Cash Flows
Section: Chapter Questions
Problem 13P: Comprehensive The following are Farrell Corporations balance sheets as of December 31, 2019, and...
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Transcribed Image Text:D) On January 1, P-Corporation and S-Corporation had condensed balance sheets as follows:
Park
Strand
Current assets
$ 70,000
$20,000
40,000
$60,000
$10,000
Noncurrent assets
90,000
$160,000
$ 30,000
Total assets .
Current liabilities
Long-term debt .
Stockholders' equity .
50,000
80,000
50,000
Total liabilities and equities..
$160,000
$60,000
On January 2, P-co borrowed $60,000 and used the proceeds to obtain 80 percent of the outstanding
common shares of Strand. The acquisition price was considered proportionate to S-co's total fair
value. The $60,000 debt is payable in 10 equal annual principal payments, plus interest, beginning
December 31. The excess fair value of the investment over the underlying book value of the acquired
net assets is allocated to inventory (60 percent) and to goodwill (40 percent).
Required:
Calculate the amount of the following consolidated balance sheet items as of January 2,
i.
Current assets and Noncurrent assets, separately:
ii.
Current liabilities, Noncurrent liabilities &Stockholders' equity.
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