$ 10,000 40,000 200,000 20,000 $270,000 $ 30,000 100,000 Cash Accounts payable Notes payable Inventory Property, plant, and equipment Patent Shareholders' equity 140,000 $270,000 On January 2, 2019, Paul Company purchased Marino by acquiring all its outstanding shares for $300,000 cash. On that date, the fair value of the inventory was $30,000, and the fair value of the equipment was $240,000. In addition, the fair value of a previously unrecorded customer list was $25,000. For all other amounts, the book value of January 1, 2019, equaled fair value.

$ 10,000 40,000 200,000 20,000 $270,000 $ 30,000 100,000 Cash Accounts payable Notes payable Inventory Property, plant, and equipment Patent Shareholders' equity 140,000 $270,000 On January 2, 2019, Paul Company purchased Marino by acquiring all its outstanding shares for $300,000 cash. On that date, the fair value of the inventory was $30,000, and the fair value of the equipment was $240,000. In addition, the fair value of a previously unrecorded customer list was $25,000. For all other amounts, the book value of January 1, 2019, equaled fair value.

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

Chapter14: Financing Liabilities: Bonds And Long-term Notes Payable

Section: Chapter Questions

Problem 12MC: (Appendix 14.1)Pamlico Company has a 500,000, 15%, 3-year note dated January 1, 2019, payable to...

See similar textbooks

Similar questions

20 Danica Company had the following assets at December 31, 2024: Cash (of which P25,000 is earmarked for the acquisition of equipment) 490,000 Trading securities (including P200,000 investment in FVOCI) 380,000 Accounts receivable, net 1,250,000 Non-trade notes receivable (due in equal semi-annual installments of P50,000 every March 1 and September 1) 300,000 Merchandise inventory 900,000 Prepaid expenses 80,000 Plant and equipment, net 3,750,000 How much is Danica Company’s total current asset? Group of answer choices 3,400,000 2,425,000 2,745,000 2,975,000
26 Sniper Company purchased on January 2, 2019, a new set of furniture and fixtures by issuing 5,000 of its P100 par value shares (FV on this date is P110), in addition to P200,000 cash paid in connection to purchase. The P200,000 is broken as follows: Freight and delivery charges P80,000 Non-refundable purchase taxes 70,000 Furniture cover* 50,000 Total P200,000 *the furniture cover was requested by the company president because he wanted his office furniture looks good. The cover does not enhance the asset. The furniture and fixture are depreciated using 1.5 declining balance with an estimated useful life of four years and salvage value of P80,000. What is the amount of depreciation expense – furniture and fixtures should Sniper Company recognized in its December 31, 2022 income statement?
PROBLEM 35At the beginning of 2018, Esterlina Corporation purchased 40% of the ordinary shares outstanding of Mary Grace Incorporated for P15,000,000 when the net assets of Mary Grace Incorporated amounted to P30,000,000. At the acquisition date, the carrying amounts of the identifiable assets and liabilities of Mary Grace Incorporated were equal to their fair value, except for the following: a. Equipment whose fair value was P7,000,000 greater than its carrying amount.b. Inventory whose fair value was P2,500,000 greater than its carrying amount. The equipment has a remaining life of 4 years, and the inventory was all sold during 2013. Mary Grace Incorporated has two classes of shares: Ordinary shares (par value, P100), 300,000 shares outstanding, 15% cumulative preference shares (par value, P50), 100,000 shares outstanding. The investee reported the following net income (inclusive of enter-company transactions) and payment of cash dividend: 2018…
PROBLEM 34 On January 1, 2020, Edelyn Corporation acquired 10,000 shares of JKL Company for P500,000. The 10,000 shares are equivalent to 20% interest of the investee. JKL Company reported the following net income or loss: 2020 - P1,000,0002021 - (P5,000,000)2022 - P300,000 Requirements:1. Prepare the necessary journal entries to record the share of income or loss in 2020, 2021, and 2022.2. What is the carrying value of the investment on December 31, 2020? December 31, 2021? December 31, 2022?
#50 Ziegler Corporation purchased 25,000 shares of common stock of the Sherman Corporation for $40 per share on January 2, 2020. Sherman Corporation had 100,000 shares of common stock outstanding during 2021, paid cash dividends of $150,000 during 2021, and reported net income of $500,000 for 2021. Ziegler Corporation should report revenue from investment for 2021 in the amount of Question 50 options: a $125,000. b $87,500. c $37,500. d $137,500.
16 All the issued and outstanding common stock of MOA Company were brought by Aura Company on October 1, 2020 for P700,000. The assets and liabilities of Aura Company were: Cash 50,000 Accounts receivable (net of P25,000 allowance for bad debts) 250,000 Inventory 150,000 Property & Equipment (net of P100,000, allowance for depreciation) 300,000 Accounts payable 130,000 On October 1, 2020 the fair value of the following assets was as follows: Accounts receivable (net) 235,000 Inventory 130,000 Property & equipment (net) 400,000 There is an unrecorded warranty liability on prior-product sales estimated P20,000 discounted cash flow based on estimated future cash flows. The amount of goodwill as a result of the business combination should be: Group of answer choices 65,000 100,000 35,000 Zero
24. When preparing a draft of its December 31, 2020 balance sheet. Era Joy reported net assets totaling P50,000,000. Included is the asset section of the balance sheet were: • Treasury stock of Era Joy Company at cost, which approximates market value on December 31, P5,000,000 • Property no longer adopted for use in business, P1,000,000 • Cash surrender value, P500,000 • Allowance for unrealized loss on noncurrent equity investments, P1,500,000 • Computer software, P4,000,000 At what amount, should the net assets be reported on December 31, 2020?
Question 5 During 2021 Carla Vista Company purchased 9500 shares of Metlock Inc. for $25 per share. During the year Carla Vista Company sold 2250 shares of Metlock, Inc. for $30 per share. At December 31, 2021 the market price of Metlock, Inc.’s stock was $23 per share. What is the total amount of gain/(loss) that Carla Vista Company will report in its income statement for the year ended December 31, 2021 related to its investment in Metlock, Inc. stock? $-7750 $11250 $-19000 $-3250
Question 1 Ewig Berhad acquired 800, 000 out of the 1, 000, 000 RM1 ordinary shares of Leben Berhad on 1 January 2020 for RM900, 000 cash. The general reserves and retained earnings of Leben Berhad at the date of acquisition were RM400, 000 and RM250, 000 respectively. Required: (a) What is the percentage of acquisition by Ewig Berhad? (b) What is the corporate relationship in this situation? (c) Based on MFRS 10, briefly explain whether Ewig Berhad exercises control over Leben Berhad. (d) Assuming the proportional net asset method is used, what is the fair value of the NCI? (e) What is the goodwill or bargain purchase?
5. PSA Inc. prepared a draft of its 2021 Statement of Financial Position. The draft statement reported total assets of P4.375,000. The total assets included the following items. Treasury shares of PSA Inc. at cost, which approximates market value on December 31 P120,000 Unamortized patent 56,000 Cash surrender value of life insurance 68,500 Cumulative translation loss 42,000 At what amount should total assets be correctly reported in the December 31,2010 Statement of Financial Position?
43 Sycamore, Inc. purchased P100,000 of 8 percent bonds of Alvarado Industries on January 1, 2022, at a discount, paying P92,278. The bonds mature January 1, 2027, and yield 10 percent; interest is payable each July 1 and January 1. Sycamore has a business model whose objective is to hold assets in order to collect contractual cash flows and the contractual terms of the financial asset provides specified dates with regard to cash flows that are solely payments of principal and interest. On December 31, 2022, when the market rate of interest is 12%, and the fair value of the bonds is P89,934, Sycamore will record interest revenue in 2022 of?
27 On January 1, 2019 P Company acquired 70% in S company for $4,200,000; at this date S company has capital stock and retained earnings of $5,000,000 and $800,000 respectively, and have a treasury stock of $100,000. The identifiable assets and liabilities are as follow: Fair value Book value Inventory 200,000 260,000 Equipment(net) 900,000 990,000 Land 1,600,000 1,500,000 Other current assets 500,000 500,000 Other non current assets 50,000 50,000 At the date of acquisition P Company will recognise a goodwill or bargain gain of :