On December 31, Year 1,P Company purchased 80% of the outstanding shares of S Company for $7,840 cash. The statements of financial position of the two companies immediately after the acquisition transaction appear below. Plant of culpment (net) Investment in 5 Company Inventory Accounts receivable Cash Ordinary shares Retained earnings Long-term liabilities Other current liabilities Accounts payable P Company Carrying Amount $ 9,200 7,840 6,260 5,350 $ 32,350 $ 11,600 14,150 4,000 1,100 1,500 $ 32,350 s Company Carrying Amount $ 8,100 5,000 2,900 2,150 $ 18,150 $ 4,100 6,250 3,100 2,900 1,800 $ 18,150 Fair Value $ 6,000 5,600 2,900 2.150 3,100 1,800

On December 31, Year 1,P Company purchased 80% of the outstanding shares of S Company for $7,840 cash. The statements of financial position of the two companies immediately after the acquisition transaction appear below. Plant of culpment (net) Investment in 5 Company Inventory Accounts receivable Cash Ordinary shares Retained earnings Long-term liabilities Other current liabilities Accounts payable P Company Carrying Amount $ 9,200 7,840 6,260 5,350 $ 32,350 $ 11,600 14,150 4,000 1,100 1,500 $ 32,350 s Company Carrying Amount $ 8,100 5,000 2,900 2,150 $ 18,150 $ 4,100 6,250 3,100 2,900 1,800 $ 18,150 Fair Value $ 6,000 5,600 2,900 2.150 3,100 1,800

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

Chapter13: Investments And Long-term Receivables

Section: Chapter Questions

Problem 19E

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