Acquisition of Facebook by AmazonPP&E, Goodwill and Other Intangibles AssumptionsTotal Book Value of PP&E, Goodwill and Other IntangiblesFMV of PP&E, Goodwill and Other IntangiblesFMV of PP&E, Goodwill and Intangibles Attributed to Depreciable PropertyS71,505$766,98171.50%FMV of PP&E, Goodwill and Intangibles Attributed to Non-Depreciable Property 28.50%Average Amortization Period (Years)13.5 YearsDebt AssumptionsDebt issued for acquisition of Facebook$187,038Interest on New Debt4.0%Term of New Debt10 YearsNew Debt Financing Fees0.5%Other AssumptionsOther Transaction Costs$20Efective Tax Rate30.0%Amazon Net EarningsFacebook Net Eamings$23,688S30,13315The total after-tax pro-forma adjustment to Amazon'snet earnings is expected to be:($44,442)($31,109)($22,711)$57,774

Working Note #1 Depreciation Expenses: i) Increase in Fair Market Value as a result of the…

Answered: The total after-tax pro-forma…

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

Chapter12: Intangibles

Section: Chapter Questions

Problem 9MC

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A fixed asset with a cost of $36,671 and accumulated depreciation of $33,004 is traded for a similar asset priced at $53,888 (fair market value) in a transaction with commercial substance. Assuming a trade-in allowance of $4,581, at what cost will the new equipment be recorded in the books? a.$914 b.$4,581 c.$32,090 d.$53,888
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The total after-tax pro-forma adjustment to Amazon's net earnings is expected to be: ($44,442) ($31,109) ($22,711) $57,774