Consolidation is the merger or acquisition of small companies into a single large one. In financial accounting, consolidation means an aggregation of financial statements of a group company/different entities and reported at the group level. To prepare: Journal Entries

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Answer 1

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Chapter 4, Problem 4.12E

1.

To determine

Introduction: Consolidation is the merger or acquisition of small companies into a single large one. In financial accounting, consolidation means an aggregation of financial statements of a group company/different entities and reported at the group level.

To prepare: Journal Entries

2.

To determine

Introduction: Consolidation is the merger or acquisition of small companies into a single large one. In financial accounting, consolidation means aggregation of financial statement of a group company/different entities and reported at group level.

To prepare: Difference in Consolidation entries and other Journal Entries

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E 1-5 Journal entries to record an acquisition with direct costs and fair value/book value differences On January 1, Pop Corporation pays $400,000 cash and also issues 36,000 shares of $10 par common stock with a market value of $660,000 for all the outstanding common shares of Son Corporation. In addition, Pop pays $60,000 for registering and issuing the 36,000 shares and $140,000 for the other direct costs of the business combination, in which Son Corporation is dissolved. Summary balance sheet information for the companies immediately before the merger is as follows (in thousands): Pop Book Value Son Book Value Son Fair Value Cash $ 700 $ 80 $ 80 Inventories 240 160 200 Other current assets 60 40 40 Plant assets—net 520 360 560 Total assets $1,520 $640 $880 Current liabilities $ 320 $ 60 $ 60 Other liabilities 160 100 80 Common stock, $10 par 840 400…

Companies X, Y and Z, parties to a consolidation, have the following data: X Co Y Co Z CoNet assets P400,000 P600,000 P1,000,000Average annual earnings 60,000 60,000 80,000The parties collectively agreed that the new corporation, AA Co will issue a single class of stock based on the earnings ratio. What is the stock distribution ratio to companies X, Y and Z, respectively?

Penny Manufacturing Company acquired 75 percent of Saul Corporation stock at underlying book value. At the date of acquisition, the fair value of the noncontrolling interest was equal to 25 percent of Saul’s book value. The balance sheets of the two companies for January 1, 20X1, are as follows: On January 2, 20X1, Penny purchased an additional 2,500 shares of common stock directly from Saul for $150,000. Required:a. Prepare the consolidation entry needed to complete a consolidated balance sheet worksheet immediately following the issuance of additional shares to Penny. b. Prepare a consolidated balance sheet worksheet immediately following the issuance of additional shares to Penny.

Answer 2

Question

Chapter 4, Problem 4.12E

1.

To determine

Introduction: Consolidation is the merger or acquisition of small companies into a single large one. In financial accounting, consolidation means an aggregation of financial statements of a group company/different entities and reported at the group level.

To prepare: Journal Entries

2.

To determine

Introduction: Consolidation is the merger or acquisition of small companies into a single large one. In financial accounting, consolidation means aggregation of financial statement of a group company/different entities and reported at group level.

To prepare: Difference in Consolidation entries and other Journal Entries

Expert Solution & Answer

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Check out a sample textbook solution

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Answer 3

Question

Chapter 4, Problem 4.12E

1.

To determine

Introduction: Consolidation is the merger or acquisition of small companies into a single large one. In financial accounting, consolidation means an aggregation of financial statements of a group company/different entities and reported at the group level.

To prepare: Journal Entries

2.

To determine

Introduction: Consolidation is the merger or acquisition of small companies into a single large one. In financial accounting, consolidation means aggregation of financial statement of a group company/different entities and reported at group level.

To prepare: Difference in Consolidation entries and other Journal Entries

Expert Solution & Answer

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Check out a sample textbook solution

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Answer 4

Question

Chapter 4, Problem 4.12E

1.

To determine

Introduction: Consolidation is the merger or acquisition of small companies into a single large one. In financial accounting, consolidation means an aggregation of financial statements of a group company/different entities and reported at the group level.

To prepare: Journal Entries

2.

To determine

Introduction: Consolidation is the merger or acquisition of small companies into a single large one. In financial accounting, consolidation means aggregation of financial statement of a group company/different entities and reported at group level.

To prepare: Difference in Consolidation entries and other Journal Entries

Expert Solution & Answer

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Check out a sample textbook solution

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Answer 5

Chapter 4, Problem 4.12E

1.

To determine

Introduction: Consolidation is the merger or acquisition of small companies into a single large one. In financial accounting, consolidation means an aggregation of financial statements of a group company/different entities and reported at the group level.

To prepare: Journal Entries

2.

To determine

Introduction: Consolidation is the merger or acquisition of small companies into a single large one. In financial accounting, consolidation means aggregation of financial statement of a group company/different entities and reported at group level.

To prepare: Difference in Consolidation entries and other Journal Entries

Answer 6

Chapter 4, Problem 4.12E

1.

To determine

Introduction: Consolidation is the merger or acquisition of small companies into a single large one. In financial accounting, consolidation means an aggregation of financial statements of a group company/different entities and reported at the group level.

To prepare: Journal Entries

Answer 7

Chapter 4, Problem 4.12E

1.

To determine

Introduction: Consolidation is the merger or acquisition of small companies into a single large one. In financial accounting, consolidation means an aggregation of financial statements of a group company/different entities and reported at the group level.

To prepare: Journal Entries

Answer 8

2.

To determine

Introduction: Consolidation is the merger or acquisition of small companies into a single large one. In financial accounting, consolidation means aggregation of financial statement of a group company/different entities and reported at group level.

To prepare: Difference in Consolidation entries and other Journal Entries

Answer 9

2.

To determine

Introduction: Consolidation is the merger or acquisition of small companies into a single large one. In financial accounting, consolidation means aggregation of financial statement of a group company/different entities and reported at group level.

To prepare: Difference in Consolidation entries and other Journal Entries

Answer 10

Expert Solution & Answer

Answer 11

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Answer 12

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Answer 13

Ch. 4 - When is the carrying value of the investment...Ch. 4 - What is a differential? How is a differential...Ch. 4 - Prob. 4.3Q Ch. 4 - Prob. 4.4Q Ch. 4 - Prob. 4.5Q Ch. 4 - Prob. 4.6Q Ch. 4 - Prob. 4.7Q Ch. 4 - Prob. 4.8Q Ch. 4 - Prob. 4.9Q Ch. 4 - Prob. 4.10Q

Consolidation is the merger or acquisition of small companies into a single large one. In financial accounting, consolidation means an aggregation of financial statements of a group company/different entities and reported at the group level. To prepare: Journal Entries

Solution Summary: The author explains that consolidation is the merger or acquisition of small companies into a single large one.

Concept explainers

Introduction: Consolidation is the merger or acquisition of small companies into a single large one. In financial accounting, consolidation means an aggregation of financial statements of a group company/different entities and reported at the group level.

To prepare: Journal Entries

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Chapter 4 Solutions

Consolidation is the merger or acquisition of small companies into a single large one. In financial accounting, consolidation means an aggregation of financial statements of a group company/different entities and reported at the group level. To prepare: Journal Entries

Solution Summary: The author explains that consolidation is the merger or acquisition of small companies into a single large one.

Concept explainers

Introduction: Consolidation is the merger or acquisition of small companies into a single large one. In financial accounting, consolidation means an aggregation of financial statements of a group company/different entities and reported at the group level. To prepare: Journal Entries

Want to see the full answer?

Chapter 4 Solutions

Introduction: Consolidation is the merger or acquisition of small companies into a single large one. In financial accounting, consolidation means an aggregation of financial statements of a group company/different entities and reported at the group level.

To prepare: Journal Entries