E 2-3 Calculate percentage ownership and goodwill on investment acquired directly from investee Son Corporation’s stockholders’ equity at December 31, 2015, consisted of the following (in thousands): Capital stock, $10 par, 60,000 shares issued and outstanding $600 Additional paid-in capital 150 Retained earnings 250 Total stockholders’ equity $1,000 On January 1, 2016, Pop Corporation purchased 20,000 previously unissued shares of Son stock directly from Son Corporation for $500,000. Required Calculate Pop Corporation’s percentage ownership in Son. Determine the goodwill (if any) from Pop’s investment in Son. Assume book values of all identifiable assets and liabilities equal the fair values.
E 2-3 Calculate percentage ownership and goodwill on investment acquired directly from investee Son Corporation’s stockholders’ equity at December 31, 2015, consisted of the following (in thousands): Capital stock, $10 par, 60,000 shares issued and outstanding $600 Additional paid-in capital 150 Retained earnings 250 Total stockholders’ equity $1,000 On January 1, 2016, Pop Corporation purchased 20,000 previously unissued shares of Son stock directly from Son Corporation for $500,000. Required Calculate Pop Corporation’s percentage ownership in Son. Determine the goodwill (if any) from Pop’s investment in Son. Assume book values of all identifiable assets and liabilities equal the fair values.
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter1: Accounting And The Financial Statements
Section: Chapter Questions
Problem 41E: Exercise 1-41 Stockholders Equity OBJECTIVE o On January 11 2019, Mulcahy Manufacturing Inc., a...
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E 2-3 Calculate percentage ownership and goodwill on investment acquired directly from investee
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Son Corporation’s stockholders’ equity at December 31, 2015, consisted of the following (in thousands):
Capital stock, $10 par, 60,000 shares issued and outstanding
$600
Additional paid-in capital
150
Retained earnings 250
Total stockholders’ equity
$1,000
On January 1, 2016, Pop Corporation purchased 20,000 previously unissued shares of Son stock directly from Son Corporation for $500,000.
Required
-
Calculate Pop Corporation’s percentage ownership in Son.
-
Determine the goodwill (if any) from Pop’s investment in Son. Assume book values of all identifiable assets and liabilities equal the fair values.
-
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