Question

In: Accounting

1. Consider the following information from the financial statements of Para Inc. and SIG Co.                           &nbsp

1. Consider the following information from the financial statements of Para Inc. and SIG Co.

                                                   P                               S

Separate income                      450

Net income                                                                  300

Separate OCI                          125                              100

S – OCI (P’s share)                 80

Provide the following:

a. Total Consolidated Net Income _________

b. Consolidated OCI_________

c. P’s %, Consolidated OCI_________

d. P’s %, Consolidated Net Income_________

e. Total Consolidated Comprehensive Income_________

f. P’s %, Consolidated Comprehensive Income_________

2. Assume the following data apply shortly after Perfunctory Co. acquires Serious, Inc.:

                                                P Co. (000s)                S Co. (000s)

Assets                                                  400                              200

Liabilities                                            250                              100

CS                                                       75                              60

APIC/OCC                                         50                              30

RE                                                       25                              10

P assets have a fair value = 435k; S’ identifiable assets have a fair value = 320k. P acquires 75% of S’s outstanding voting stock for $165k cash. S’ assets include pre-acquisition Goodwill of 40k, and P’s assets (and S’ liabilities) reflect a loan P has made to S for 10k. The DOA consolidated Balance Sheet should show:

a. identifiable assets____________

b. liabilities____________

c. Common Stock____________

d. APIC/OCC_____________

e. RE_____________

f. Goodwill (algebraic)____________

Solutions

Expert Solution

Requirement 1
a. $   750 (450+300)
b. $   225 (125+100)
C. 91.11% (125+80)/225*100
d. 92.00% (450+240)/750*100
e. $   975 (750+225)
f. 91.79% (205+690)/975*100
Requirement 2
a. $ 745 (435+320-10)
b. $ 340 (250+100-10)
C. $   75
d. $   73 (50+30*75%)
e. $   33 (25+10*75%)
f. $    -   W.N.1
W.N.1
S Co.
CS $   60
APIC $   30
RE $ 130 (10+(320-200))
$ 220
P's Share $ 165 (220*75%)
Cash Paid $ 165
Goodwill $    -  

ekkarill92 answered 1 year ago
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