Question

In: Accounting

Statue Corporation’s balance sheet at January 1, 20X7, reflected the following balances: Assets Liabilities & Stockholders’...

Statue Corporation’s balance sheet at January 1, 20X7, reflected the following balances:


Assets			Liabilities & Stockholders’ Equity
Cash & Receivables	$	80,000	Accounts Payable	$	40,000
Inventory		120,000	Income Taxes Payable		60,000
Land		70,000	Bonds Payable		200,000
Buildings & Equipment (net)		480,000	Common Stock		250,000
			Retained Earnings		200,000
Total Assets	$	750,000	Total Liabilities & Stockholders’ Equity	$	750,000

Prize Corporation entered into an active acquisition program and acquired 80 percent of Statue's common stock on January 2, 20X7, for $470,000. The fair value of the noncontrolling interest at that date was determined to be $117,500. A careful review of the fair value of Statue's assets and liabilities indicated the following:

	Book Value			Fair Value
Inventory		$	120,000		$	140,000
Land			70,000			60,000
Buildings & Equipment (net)			480,000			550,000

Goodwill is assigned proportionately to Prize and the noncontrolling shareholders.

Required:
Compute the appropriate amount related to Statue to be included in the consolidated balance sheet immediately following the acquisition for each of the following items:

Items	Amounts
Inventory	140,000
Land	60,000
Building and Equipment	550,000
Goodwill
Investment in Statue	0
No controlling Interest

Expert Solution

Inventory = $140,000

Land = $60,000

Building = $550,000

Goodwill = $57,500

Investment in Statue = 0

Non-controlling interest = $117,500

Working note:

Calculation of Goodwill:

Results of the excel sheet are as follows:

Calculation of Non-controlling interest:

Non-controlling interest = Total fair value x Non-controlling interest percent

= $587,500 x 20%

= $117500

ekkarill92 answered 1 year ago

January 1, 2017, the stockholders’ equity section of Jayhawk Corporation’s balance sheet showed the following Preferred...

January 1, 2017, the stockholders’ equity section of Jayhawk Corporation’s balance sheet showed the following Preferred stock, $100 par value, 5%, 50,000 shares authorized, 5,000 shares issued and outstanding $500,000 Paid in capital in excess of par, Preferred Stock 100,000 Common stock, $3 par value, 500,000 shares authorized, 20,000 shares issued and outstanding 60,000 Paid in capital in excess of par, Common Stock 250,000 Total contributed Capital 910,000 Retained Earnings 320,000 Total Stockholders' Equity $1,230,000 During the year, 2017, the...

Stockholders’ Equity: Transactions and Statement The stockholders’ equity section of Night Corporation’s balance sheet at January...

Stockholders’ Equity: Transactions and Statement The stockholders’ equity section of Night Corporation’s balance sheet at January 1 follows: Common stock, $5 par value, 300,000 shares authorized, 60,000 shares $300,000 issued, 6,000 shares in treasury Additional paid-in capital In excess of par value $480,000 From treasury stock 30,000 510,000 Retained earnings 348,000 1,158,000 Less: Treasury stock (6,000 shares) at cost 138,000 Total Stockholders’ Equity $1,020,000 The following transactions affecting stockholders’ equity occurred during the year: Jan. 8 Issued 15,000 shares of...

BALANCE SHEET December 31, 20X8 and 20X7 (in thousands) 20X8 20X7 Assets Current assets Cash and...

BALANCE SHEET December 31, 20X8 and 20X7 (in thousands) 20X8 20X7 Assets Current assets Cash and cash equivalents $3,019 $1,050 Trade receivables 485 450 Prepaid advertising expenses 59 609 Prepaid expenses and other current assets 175 230 Total current assets 3,738 2,339 Fixed assets, net 3,321 3,926 Total assets $7,059 $6,265 Liabilities and shareholders' equity Current liabilities Accounts payable $1,070 $ 909 Current maturities of notes payable 42 316 Deferred revenue 1,973 1,396 Other current liabilities 171 12 Total current...

1. The balance sheet consists of assets and liabilities and equity. With a focus on liabilities,...

1. The balance sheet consists of assets and liabilities and equity. With a focus on liabilities, discuss the connectedness of these three components. 2. Discuss the components needed to determine the present value of a noncurrent liability. 3. Discuss the relationship between the income statement and the shareholders' equity section of the balance sheet. 4. Discuss the purpose of other comprehensive income and accumulated other comprehensive income. 5. Compare and contrast book value per share and market capitalization. 6. Evaluate...

DietWeb, Inc. BALANCE SHEET December 31, 20X8 and 20X7 (in thousands) 20X8 20X7 Assets Current assets...

DietWeb, Inc. BALANCE SHEET December 31, 20X8 and 20X7 (in thousands) 20X8 20X7 Assets Current assets Cash and cash equivalents $3,019 $1,050 Trade receivables 485 450 Prepaid advertising expenses 59 609 Prepaid expenses and other current assets 175 230 Total current assets 3,738 2,339 Fixed assets, net 3,321 3,926 Total assets $7,059 $6,265 Liabilities and shareholders' equity Current liabilities Accounts payable $1,070 $ 909 Current maturities of notes payable 42 316 Deferred revenue 1,973 1,396 Other current liabilities 171 12...

Nittany, Inc. had the following balances on its balance sheet: Assets Liabilities December 31, 2018 $300,000...

Nittany, Inc. had the following balances on its balance sheet: Assets Liabilities December 31, 2018 $300,000 $250,000 December 31, 2019 $400,000 $320,000 During 2019, Nittany, Inc. had revenues of $850,000 and expenses of $650,000. No new stock was issued. The amount of dividends for 2019 was ________.

Balance Sheet (in $ millions) Assets Liabilities and Stockholders' Equity Cash ...................................... $ 7 Accounts payable ............$20 Accounts...

Balance Sheet (in $ millions) Assets Liabilities and Stockholders' Equity Cash ...................................... $ 7 Accounts payable ............$20 Accounts receivable ............ 25 Accrued wages .................7 Inventory .............................. 28 Accrued taxes .................. 13 Current assets ................... $80 Current liabilities .......... $40 Fixed assets ......................... 25 Notes payable ..................15 Common stock .................20 Retained earnings ............ 30 Total Assets ...........................$105 Total liabilities and stockholders’ equity .......$105 If the firm’s sales for last year were $100 million, and the balance sheet at year-end is similar in percentage of sales to that of...

At December 31, 20X7, Big Corporation reports the following stockholders' equity on its balance sheet. Big...

At December 31, 20X7, Big Corporation reports the following stockholders' equity on its balance sheet. Big uses the cost method for treasury stock accounting. The company held no stock in treasury at this date. Preferred Stock, 8%, $20 par, cumulative, non-participating $3,000,000 Common Stock, $5 par 10,000,000 Paid-in Capital in Excess of Par-Preferred 200,000 Paid-in Capital in Excess of Par-Common 27,000,000 Retained Earnings 4,500,000 During 20X8, the following transactions affected stockholders' equity: Jan. 1 30,000 shares of preferred stock issued...

Problem 2: Bellamerica Co’s January 1, 2017 balance sheet is as follows: Assets Liabilities & Equity...

Problem 2: Bellamerica Co’s January 1, 2017 balance sheet is as follows: Assets Liabilities & Equity Cash, receivables $ 3,000,000 Current liabilities $ 2,000,000 Inventories 4,000,000 Long-term liabilities 6,500,000 Equity method investments 1,000,000 Capital stock 4,000,000 Land, buildings & equipment 5,500,000 Retained earnings 3,500,000 Goodwill 2,000,000 Accumulated other comprehensive loss (400,000) _________ Treasury stock (100,000) Total assets $15,500,000 Total liabilities & equity $15,500,000 On January 1, 2017, Prance Corporation acquired Bellamerica’s assets and liabilities for $40 million in cash....

Sully Company’s January 1, 2020 balance sheet is as follows: Assets Liabilities & Equity Cash, receivables...

Sully Company’s January 1, 2020 balance sheet is as follows: Assets Liabilities & Equity Cash, receivables $ 3,000,000 Current liabilities $ 2,000,000 Inventories 4,000,000 Long-term liabilities 6,500,000 Equity method investments 1,000,000 Capital stock 2,000,000 Land, buildings & equipment 5,500,000 Retained earnings 3,500,000 Accumulated other comprehensive loss (400,000) _________ Treasury stock (100,000) Total assets $13,500,000 Total liabilities & equity $13,500,000 On January 1, 2020, Pronto Corporation acquired Sully’s assets and liabilities for $50 million in cash. Sully’s cash and receivables, and...