ADVANCED ACCOUNTING
13th Edition
ISBN: 9781260773033
Author: Hoyle
Publisher: MCG
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Question
Chapter 2, Problem 25P
a.
To determine
Prepare Company Z’s
b.
To determine
Prepare Company Z’s journal entries to record the Company S’s acquisition assuming its initial cash payment to the former owners was $800,000.
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On May 1, Soriano Co. reported the following account balances along with their estimated fair values:
Carrying
Amount
Fair Value
151,000
80,000
587,000
652,000
1,470,000
Receivables
151,000
80,000
Inventory
Copyrights
Patented technology
168,000
855,000
$ 1, 254,000
Total assets
237,000 $
694,000
100,000
223,000
Current liabilities
237,000
Long-term liabilities
Common stock
681, 000
Retained earnings
Total liabilities and equities
$ 1,254,000
On that day, Zambrano paid cash to acquire all of the assets and liabilities of Soriano, which will cease to exist as a separate entity. To
facilitate the merger, Zambrano also paid $105,000 to an investment banking firm.
The following information was also available:
• Zambrano further agreed to pay an extra $82,400 to the former owners of Soriano only if they meet certain revenue goals during
the next two years. Zambrano estimated the present value of its probability adjusted expected payment for this contingency at
$41,200.
Soriano has a…
On May 1, Soriano Company reported the following account balances along with their estimated fair values:
Fair Value
Carrying Amount
$ 196,000
85,000
171,000
874,000
Receivables
Inventory
Copyrights
Patented technology
Total assets
Current liabilities
Long-term liabilities
Common stock
Retained earnings
Total liabilities and equities
Items
View transaction list
$ 1,326,000
$216,000
742,000
100,000
268,000
$ 1,326,000
4
On that day, Zambrano paid cash to acquire all of the assets and liabilities of Soriano, which will cease to exist as a separate entity. To
facilitate the merger, Zambrano also paid $125,500 to an investment banking firm.
The following information was also available:
. Zambrano further agreed to pay an extra $78,200 to the former owners of Soriano only if they meet certain revenue goals during
the next two years. Zambrano estimated the present value of its probability adjusted expected payment for this contingency at
$39.100.
• Soriano has a research and development…
Carmela Company, as of December 31, 2021 provided the following balances:
Cash, net of a P7,000 overdraft
80,000
Receivable, net of customer credit balances totaling P6,000
30,000
Inventory (P20,000 of which are held on consignment)
60,000
Prepayments
10,000
Property, plant and equipment, net of accumulated depreciation of P15,000
90,000
Accounts payable net of debit balances in suppliers' accounts of P3,000
45,000
Notes payable - bank, due on July 2022
25,000
Income tax payable
15,000
Total current assets reported in the December 31, 2021 balance sheet is
Chapter 2 Solutions
ADVANCED ACCOUNTING
Ch. 2 - Prob. 1QCh. 2 - Prob. 2QCh. 2 - What does the term consolidated financial...Ch. 2 - Within the consolidation process, what is the...Ch. 2 - Prob. 5QCh. 2 - Prob. 6QCh. 2 - Prob. 7QCh. 2 - Prob. 8QCh. 2 - Prob. 9QCh. 2 - Prob. 10Q
Ch. 2 - Prob. 11QCh. 2 - Which of the following does not represent a...Ch. 2 - Prob. 2PCh. 2 - Prob. 3PCh. 2 - Prob. 4PCh. 2 - Prob. 5PCh. 2 - An acquired entity has a long-term operating lease...Ch. 2 - When does gain recognition accompany a business...Ch. 2 - Prob. 8PCh. 2 - Prob. 9PCh. 2 - Prob. 10PCh. 2 - On June 1, Cline Co. paid 800,000 cash for all of...Ch. 2 - On May 1, Donovan Company reported the following...Ch. 2 - Prob. 13PCh. 2 - Prob. 14PCh. 2 - Prob. 15PCh. 2 - Prob. 16PCh. 2 - On its acquisition-date consolidated balance...Ch. 2 - On its acquisition-date consolidated balance...Ch. 2 - Problems 19 and 20 are based on the following...Ch. 2 - In the December 31, 2017, consolidated balance...Ch. 2 - Prob. 21PCh. 2 - The following book and fair values were available...Ch. 2 - Prob. 23PCh. 2 - Prob. 24PCh. 2 - Prob. 25PCh. 2 - Prob. 26PCh. 2 - Prob. 27PCh. 2 - Prob. 28PCh. 2 - Prob. 29PCh. 2 - Prob. 30PCh. 2 - Prob. 31PCh. 2 - SafeData Corporation has the following account...Ch. 2 - Prob. 33PCh. 2 - Prob. 34PCh. 2 - Prob. 35APACh. 2 - On February 1, Piscina Corporation completed a...Ch. 2 - Prob. 37APBCh. 2 - Prob. 38APBCh. 2 - Prob. 1DYSCh. 2 - Prob. 2DYSCh. 2 - Prob. 3DYSCh. 2 - Prob. 4DYS
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