Perch Co. acquired 80% of the common stock of Float Corp. for $1,600,000. The fair value...

Perch Co. acquired 80% of the common stock of Float Corp. for $1,600,000. The fair value of Float's net assets was $1,850,000, and the book value was $1,500,000. The noncontrolling interest shares of Float Corp. are not actively traded. What is the dollar amount of noncontrolling interest that should appear in a consolidated balance sheet prepared at the date of acquisition?

$350,000.

$300,000.

$400,000.

$370,000.

Solutions

Expert Solution

Answer: c. $ 400,000

Total fair value = $ 1,600,000 / 0.8 = $ 2,000,000

Amount of noncontrolling interest = $ 2,000,000 - $ 1,600,000 = $ 400,000.

ekkarill92 answered 1 year ago

Next > < Previous

Related Solutions

Dodd Co. acquired 75% of the common stock of Wallace Corp. for $1,800,000. The fair value...

Dodd Co. acquired 75% of the common stock of Wallace Corp. for $1,800,000. The fair value of Wallace’s net assets was $2,100,000, and the book value was $1,900,000. The noncontrolling interest shares of Wallace Corp. are not actively traded. What is the dollar amount of noncontrolling interest that should appear in a consolidated balance sheet prepared at the date of acquisition? A. 525,000 B. 475,000 C. 600,000 D. 450,000 E. 75,000

Dodd Co. acquired 75% of the common stock of Wallace Corp. for $1,800,000. The fair value...

Dodd Co. acquired 75% of the common stock of Wallace Corp. for $1,800,000. The fair value of Wallace’s net assets was $2,100,000, and the book value was $1,900,000. The noncontrolling interest shares of Wallace Corp. are not actively traded.What is the dollar amount of fair value over book value differences for identifiable net assets attributed to Dodd at the date of acquisition?

Dodd Co. acquired 75% of the common stock of Wallace Corp. for $1,800,000. The fair value...

Dodd Co. acquired 75% of the common stock of Wallace Corp. for $1,800,000. The fair value of Wallace’s net assets was $2,100,000, and the book value was $1,900,000. The noncontrolling interest shares of Wallace Corp. are not actively traded. a. What amount of goodwill should be attributed to Dodd at the date of acquisition? b. What amount of goodwill should be attributed to the noncontrolling interest at the date of acquisition? c. What is the dollar amount of noncontrolling interest...

Brown Inc. acquired 75% of the common stock of Allen Co. for $1,800,000. The fair value...

Brown Inc. acquired 75% of the common stock of Allen Co. for $1,800,000. The fair value of Allen's net assets was $2,240,000, and the book value was $1,800,000. The non-controlling interest shares of Allen Corp. are not actively traded and there is no control premium. What is the total amount of goodwill recognized at the date of acquisition? A. $120,000. B. $150,000. C. $0. D. $160,000. What amount of goodwill should be attributed to Brown Inc. at the date of...

On January 1, 2015, Pack Co. acquired 80% of the common stock of Sack Co. by...

On January 1, 2015, Pack Co. acquired 80% of the common stock of Sack Co. by paying $80,000. On that date Sack' land was undervalued $3,800 and its Buildings (7 yr life) were undervalued $4,200 and its equipment (5 Yr life) were undervalued $2,000. A. Show the elements making of the cost of the investment. (Hint: Set up a schedule showing the controlling and non-controlling interest in the individual elements) B. Prepare consolidation entry S to eliminate the sub’s equity...

Problem I. On January 1, 2019, P Corp acquired 80% of the outstanding common stock of...

Problem I. On January 1, 2019, P Corp acquired 80% of the outstanding common stock of S Corp for $820,000 cash. On that date, S Company’s stockholders’ equity consisted of common stock, $150,000; other contributed capital, $200,000; and retained earnings, $350,000. P Corp paid more than the book value of net assets acquired because the recorded cost of S Corp’s equipment (5 year remaining useful life) was $40,000 less than its fair value; the remainder was allocated to goodwill. There...

Marigold Corp. issued 10100 shares of its $5 par value common stock having a fair value...

Marigold Corp. issued 10100 shares of its $5 par value common stock having a fair value of $20 per share and 14700 shares of its $15 par value preferred stock having a fair value of $30 per share for a lump sum of $518000. How much of the proceeds would be allocated to the common stock? $162731 $355269 $202000 $228250

1)When Peter Pan Co. acquired 75% of the common stock of Smee Corp., Smee owned land...

1)When Peter Pan Co. acquired 75% of the common stock of Smee Corp., Smee owned land with a book value of $70,000 and a fair value of $100,000. What is the amount of excess land allocation attributed to the controlling interest at the acquisition date? A. $0. B. $30,000. C. $22,500. D. $25,000. E. $17,500. 2) Perch Co. acquired 80% of the common stock of Salem Corp. for $1,600,000. The fair value of Salem's net assets was $1,850,000, and the...

On January 1, 2018, Riney Co. owned 80% of the common stock of Garvin Co. On...

On January 1, 2018, Riney Co. owned 80% of the common stock of Garvin Co. On that date, Garvin's stockholders' equity accounts had the following balances: Common stock ($5 par value) $ 250,000 Additional paid-in capital 110,000 Retained earnings 330,000 Total stockholders’ equity $ 690,000 The balance in Riney's Investment in Garvin Co. account was $552,000, and the noncontrolling interest was $138,000. On January 1, 2018, Garvin Co. sold 10,000 shares of previously unissued common stock for $15 per share....

Matthews Co. acquired all of the common stock of Jackson Co. on January 1, 2020. As...

Matthews Co. acquired all of the common stock of Jackson Co. on January 1, 2020. As of that date, Jackson had the following trial balance: Debit Credit Accounts payable $ 60,000 Accounts receivable $ 50,000 Additional paid-in capital 60,000 Buildings (net) (20-year life) 140,000 Cash and short-term investments 70,000 Common stock 300,000 Equipment (net) (8-year life) 240,000 Intangible assets (indefinite life) 110,000 Land 90,000 Long-term liabilities (mature 12/31/22) 180,000 Retained earnings, 1/1/20 120,000 Supplies 20,000 Totals $ 720,000 $ 720,000...

Subjects