The following book and fair values were available for NorthStar Company as of March 1. BluePrint Company pays $4,200,000 cash for all of NorthStar’s common stock in a merger, after which NorthStar will cease to exist as a separate entity. BluePrint pays $70,000 for legal fees to complete the transaction. Required: Pass the necessary journal entries in the books of BluePrint for its acquisition of NorthStar’s common stocks.

The following book and fair values were available for NorthStar Company as of March 1. BluePrint Company pays $4,200,000 cash for all of NorthStar’s common stock in a merger, after which NorthStar will cease to exist as a separate entity. BluePrint pays $70,000 for legal fees to complete the transaction. Required: Pass the necessary journal entries in the books of BluePrint for its acquisition of NorthStar’s common stocks.

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

Chapter15: Contributed Capital

Section: Chapter Questions

Problem 17E

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Swifty Corporation’s comparative balance sheets are presented below. SWIFTY CORPORATIONBalance SheetsDecember 3120222021Cash$12,500 $6,100 Accounts receivable18,400 26,600 Inventory13,200 10,200 Land34,200 30,200 Building76,200 76,200 Accumulated depreciation(17,200) (14,200)Total137,300 135,100 Accounts payable19,500 33,300 Common stock ($5 par)74,500 74,500 Retained earnings43,300 27,300 Total137,300 135,100 Swifty’s 2022 income statement included net sales of $122,000, cost of goods sold of $82,000, and net income of $31,000. Compute the following ratios for 2022. (Round Debt to total assets ratio to 1 decimal place, e.g 1.8 and all percentage and days answers to 0 decimal places, e.g 18 or 25% and all other answers to 2 decimal places, e.g. 1.83) (a)Current ratioenter the ratio rounded to 2 decimal places (b)Acid-test ratioenter the ratio rounded to 2 decimal places…
Swifty Corporation’s comparative balance sheets are presented below. SWIFTY CORPORATIONBalance SheetsDecember 3120222021Cash$12,500 $6,100 Accounts receivable18,400 26,600 Inventory13,200 10,200 Land34,200 30,200 Building76,200 76,200 Accumulated depreciation(17,200) (14,200)Total137,300 135,100 Accounts payable19,500 33,300 Common stock ($5 par)74,500 74,500 Retained earnings43,300 27,300 Total137,300 135,100 Swifty’s 2022 income statement included net sales of $122,000, cost of goods sold of $82,000, and net income of $31,000. Compute the following ratios for 2022. (Round Debt to total assets ratio to 1 decimal place, e.g 1.8 and all percentage and days answers to 0 decimal places, e.g 18 or 25% and all other answers to 2 decimal places, e.g. 1.83) Inventory turnoverenter the number rounded to 2 decimal places Days in inventoryenter the number of days rounded to 0 decimal…
Swifty Corporation’s comparative balance sheets are presented below. SWIFTY CORPORATIONBalance SheetsDecember 3120222021Cash$12,500 $6,100 Accounts receivable18,400 26,600 Inventory13,200 10,200 Land34,200 30,200 Building76,200 76,200 Accumulated depreciation(17,200) (14,200)Total137,300 135,100 Accounts payable19,500 33,300 Common stock ($5 par)74,500 74,500 Retained earnings43,300 27,300 Total137,300 135,100 Swifty’s 2022 income statement included net sales of $122,000, cost of goods sold of $82,000, and net income of $31,000. Compute the following ratios for 2022. (Round Debt to total assets ratio to 1 decimal place, e.g 1.8 and all percentage and days answers to 0 decimal places, e.g 18 or 25% and all other answers to 2 decimal places, e.g. 1.83)
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Sandhill Co. reported the following information for 2020: Sales revenue $2520000 Cost of goods sold 1748000 Operating expenses 282000 Unrealized holding gain on available-for-sale securities 85700 Cash dividends received on the securities 9200 For 2020, Sandhill would report comprehensive income of A.$85700. B.$499200. C.$575700. D.$584900.
When preparing a draft of its 20B statement of financial position, Megs company reported net assets totaling P10,500,000. Included in the assets section were the following: Treasury shares of Megs company at cost, which approximate market value on December 31 300,000; Idle machinery, 120,000; Trademark, 150,000; Allowance for inventory write-down, 240,000. At what amount should Megs' net assets be reported in the December 31, 20B statement of financial position? CHOICES 10,200,000 10,080,000 9,960,000 9,840,000
XYZ’s balance sheet and income statement are given below:Balance SheetCash 50 Accounts payable 100A/R 150 Notes payable -Inventories 300 Long-term debt (10%) 700Fixed assets 500 Common equity (20 shares) 200Total assets 1,000 Total liabilities and equity 1,000Income StatementSales 1,000Cost of goods sold 855EBIT 145Interest 70EBT 75Taxes (33.33%) 25Net income 50The industry average inventory turnover is 5, the interest rate on the firm’s long-term debt is 10percent, 20 shares are outstanding, and the stock sells at a P/E of 8.0. If XYZ changed its inventorymethods so as to operate at the industry average inventory turnover, if it used the funds generated bythis change to buy back common stock at the current market price and thus to reduce common equity,and if sales, the cost of goods sold, and the P/E ratio remained constant, by what dollar amount wouldits stock price increase?
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