Advanced Accounting (Looseleaf)
12th Edition
ISBN: 9780077632595
Author: Hoyle
Publisher: MCG
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Question
Chapter 3, Problem 1DYS
1.
To determine
Advise J on the acceptability of its suggested immediate write-off of its identifiable intangibles.
2.
To determine
Indicate the relevant factors to consider in allocating the value assigned to identifiable intangibles acquired in a business combination to expense over time.
3.
To determine
Advise J on the acceptability of its suggested treatment of
4.
To determine
Indicate the relevant factors to consider in allocating goodwill across an enterprise’s business units.
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Accounting for intangibles
Core Telecom provides communication services in Iowa, Nebraska, the Dakotas, and Montana. Core purchased goodwill as part of the acquisition of Surety Wireless Company, which had the following figures:
Requirements
Journalize the entry to record Core’s purchase of Surety Wireless for $280,000 cash plus a $420,000 note payable.
What special asset does Core’s acquisition of Surety Wireless identify? How should Core Telecom account for this asset after acquiring Surety Wireless? Explain in detail.
Melton Devices acquires Beck, a small start-up company, by paying $2,170,900 in cash on January 2. Following are the book values and fair values of Beck on the date of acquisition.
(Click the icon to view the book values and fair values.)
Read the requirements.
Requirement a. What is the amount of goodwill acquired?
The amount of goodwill acquired
Requirement b. What intangible assets are acquired? Which of the intangibles have an indefinite life? Which will be amortized? What will the amortization expense be in the year after acquisition? (If an input field
is not used in the table leave the field empty, do not enter a zero)
Intangible
Asset
Finite or
Indefinite Life
Amortization
Amortized?
Expense
Trial Balance
Beck
Book Value
Fair Value
Cash
$
29,000 $
29,000
Receivables
100,700
100,650
Manufacturing Equipment
640,350
654,500
Patents (remaining life 8 years)
60,600
684,000
Trademarks
14,650
187,500
Payables
58,904
58,904
Print
Done
homework i
Carver Incorporated purchased a building and the land on which the building is situated for a total cost of $846,300 cash. The land
was appraised at $194,649 and the building at $778,596.
Required:
a. What is the accounting term for this type of acquisition?
b. Determine the amount of the purchase cost to allocate to the land and the amount to allocate to the building.
c. Would the company recognize a gain on the purchase?
d. Record the purchase in a horizontal statements model.
Complete this question by entering your answers in the tabs below.
Required A
Required B Required C
Required D
Check my work
Record the purchase in a horizontal statements model.
Note: Do not round intermediate calculations. Round your final answers to nearest whole dollar. In the Statement of Cash Flows column, use the initials OA to designate operating
IA for investing activity, FA for financing activity, NC for net change in cash and NA for not affected. Enter any decreases to account balances and…
Chapter 3 Solutions
Advanced Accounting (Looseleaf)
Ch. 3 - Prob. 1QCh. 3 - Prob. 2QCh. 3 - Prob. 3QCh. 3 - Prob. 4QCh. 3 - When a parent company applies the initial value...Ch. 3 - Several years ago, Jenkins Company acquired a...Ch. 3 - Benns adopts the equity method for its 100 percent...Ch. 3 - Prob. 8QCh. 3 - Prob. 9QCh. 3 - Prob. 10Q
Ch. 3 - Prob. 11QCh. 3 - Prob. 12QCh. 3 - Prob. 1PCh. 3 - Prob. 2PCh. 3 - Prob. 3PCh. 3 - Prob. 4PCh. 3 - Prob. 5PCh. 3 - Prob. 6PCh. 3 - If no legal, regulatory, contractual, competitive,...Ch. 3 - Prob. 8PCh. 3 - Prob. 9PCh. 3 - Prob. 10PCh. 3 - Prob. 11PCh. 3 - Prob. 12PCh. 3 - Prob. 13PCh. 3 - Prob. 14PCh. 3 - Prob. 15PCh. 3 - Prob. 16PCh. 3 - Prob. 17PCh. 3 - Prob. 18PCh. 3 - Prob. 19PCh. 3 - Prob. 20PCh. 3 - Prob. 21PCh. 3 - Prob. 22PCh. 3 - Prob. 23PCh. 3 - Prob. 24PCh. 3 - Prob. 25PCh. 3 - Prob. 26PCh. 3 - Prob. 27PCh. 3 - Prob. 28PCh. 3 - Prob. 29PCh. 3 - Prob. 30PCh. 3 - Prob. 31PCh. 3 - 32. Following are selected accounts for...Ch. 3 - Prob. 33PCh. 3 - Prob. 34PCh. 3 - Prob. 35PCh. 3 - Prob. 36PCh. 3 - Prob. 37PCh. 3 - Prob. 38PCh. 3 - Prob. 1DYSCh. 3 - FASB ASC AND IASB RESEARCH CASE A vice president...Ch. 3 - Prob. 4DYSCh. 3 - Prob. 5DYS
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