Advanced Accounting
12th Edition
ISBN: 9781305084858
Author: Paul M. Fischer, William J. Tayler, Rita H. Cheng
Publisher: Cengage Learning
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Chapter 1, Problem 1.2.3C
Case 1-2 Disney Acquires Marvel Entertainment
On December 31, 2009, The Walt Disney Company acquired all the capital stock of Marvel Entertainment Company. Marvel has created heroes such as Spiderman, the Hulk, and Iron Man.
Disney acquired 79.2 million shores of Marvel Entertainment’s shares. Disney issued 59 million shores of Disney stock plus $30 (or each shore of Marvel Entertainment stack. Disney stock, which has a par value of $0.01 per shore, had a market value of $32.25 per shore. The estimated fair value of Marvel Entertainment accounts were as follows:
*Other liabilities was actually a noncontrolling interest which is actually on equity interest that is discussed in Chapter 2.
3. Record the acquisition.
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Situation 1Waterway Cosmetics acquired 10% of the 189,000 shares of common stock of Martinez Fashion at a total cost of $12 per share on March 18, 2020. On June 30, Martinez declared and paid $77,300 cash dividend to all stockholders. On December 31, Martinez reported net income of $122,300 for the year. At December 31, the market price of Martinez Fashion was $13 per share.Situation 2Wildhorse, Inc. obtained significant influence over Seles Corporation by buying 30% of Seles’s 32,100 outstanding shares of common stock at a total cost of $9 per share on January 1, 2020. On June 15, Seles declared and paid cash dividends of $32,700 to all stockholders. On December 31, Seles reported a net income of $78,800 for the year.Prepare all necessary journal entries in 2020 for both situations.
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PLEASE HELP.…
Prob 1: On January 1, 2018, WONG NOODLES Corporation acquired the net assets of Natasha, Inc., by issuing 600,000 shares of its P10 par value common stock. Subsequently, Natasha was liquidated and its assets and liabilities merged into WONG NOODLES Corporation. WONG NOODLES’ stock was selling for P50 per share on January 1, 2018. The amount of goodwill recorded by WONG NOODLES in connection with the combination was P6,120,000. WONG NOODLES incurred P300,000 of legal and broker’s fees associated with the combination and P30,000 of stock issuance costs.
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Chapter 1 Solutions
Advanced Accounting
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