Advanced Financial Accounting
11th Edition
ISBN: 9780078025877
Author: Theodore E. Christensen, David M Cottrell, Cassy JH Budd Advanced Financial Accounting
Publisher: McGraw-Hill Education
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Question
Chapter 1, Problem 1.20E
a.
To determine
To calculate: The number of shares issued when market value of common stock is $25 per share.
Introduction: Common stock is a security or investment that represents ownership in the company. It is the part of company’s capital that provides shareholders a right to share profits and vote on company’s policies and composition of board of directors.
b.
To determine
To calculate: The par value per share of common stock.
Introduction: Common stock is a security or investment that represents ownership in the company. It is the part of company’s capital that provides shareholders a right to share profits and vote on company’s policies and composition of board of directors.
c.
To determine
To calculate: The amount of
Introduction: Goodwill is an intangible asset that specifies the market value of the company. It includes the company’s brand value, customer base and relation, and relationship with employees. It is not separately defined and has a contractual or legal right on the company.
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Gumiho Corporation acquired Forest Company through an exchange of common shares. All of Forest's assets
and liabilities were immediately transferred to Gumiho. Gumiho's common stock was trading at P20 per share at
the time of exchange. Following selected information is also available.
Par value of shares outstanding
Additional Paid-in Capital
Before Acquisition
P400,000
P700,000
After Acquisition
P500,000
P1,100,000
Based on the proceeding information, what is the number of shares was issued at the time of the exchange?
25,000
35,000
20,000
10,000
The Alhambra Company had these accounts at the time it was acquired by Kingdom Co.:
Cash
P 108,000
Accounts Receivable
1,371,000
Inventories
360,000
PPE
1,948,200
Accounts Payable
1,052,400
Kingdom Co. paid P4,200,000 for net assets of Alhambra Company. It has determined the fair market values
of investment and PPE were P399,000 and P2,700,000, respectively.
An assumed contingent liability arising from past events with a fair value amounting…
1. Matray acquired 16,000 ordinary shares of Petros on 1 April 20X9. On 31 December 20X8Petros’s accounts showed a share premium of $4,000 and retained earnings of $15,000. The fairmarket value of non-controlling interest at acquisition was $7,000.Below are the statements of financial position for the two companies as at 31 December 20X9:Matray PetrosNon-current assets:Property, plant and equipment 39,000 33,000Investment in Petros 50,000Current assets 78,000 40,000Total assets 167,000 73,000Equity and liabilitiesEquityOrdinary shares of: $1 each 100,000: 50c each 10,000Share premium 7,000 4,000Retained earnings 40,000 39,000Current liabilities 20,000 20,000Total equity and liabilities 167,000 73,000Required:Prepare the consolidated statement of financial position of Matray as at 31 December 20X9. Assumeprofits have accrued evenly throughout the year
Parent Corporation acquired all the identifiable net assets of Sub Company by issuing ordinary shares on January 2.
2022. Partial balance sheet for the companies prior to the business combination and immediately following the
combination is provided:
Parent
65,000
Consolidated
60,000
Sub
25,000
20,000
45,000
140,000
10,000
240,000
Cash
Accounts receivable
72,000
94,000
Inventory
Buildings
Goodwill
33,000
400,000
88,000
650,000
Total assets
570,000
75.000
350,000
Accounts payable
Bonds payable
Common stock, P2 par
Share premium
Retained earnings
Total liabilities and equities
50,000
25,000
100,000
25,000
20,000
70,000
240,000
250,000
100,000
160,000
65,000
105,000
570,000
100,000
The only consideration transferred is the issuance of shares with fair value of P8. Parent also paid business
combination expenses, share issue costs are twice the amount of indirect costs. Parent and Sub are SMES.
Chapter 1 Solutions
Advanced Financial Accounting
Ch. 1 - What types of circumstances would encourage...Ch. 1 - How would the decision to dispose of a segment of...Ch. 1 - Prob. 1.3QCh. 1 - Prob. 1.4QCh. 1 - Prob. 1.5QCh. 1 - Prob. 1.6QCh. 1 - Prob. 1.8QCh. 1 - Prob. 1.9QCh. 1 - Prob. 1.10QCh. 1 - Prob. 1.11Q
Ch. 1 - Prob. 1.12QCh. 1 - Prob. 1.13QCh. 1 - Prob. 1.14QCh. 1 - Prob. 1.15QCh. 1 - Within the measurement period following a business...Ch. 1 - Prob. 1.17QCh. 1 - Prob. 1.1CCh. 1 - Prob. 1.3CCh. 1 - Prob. 1.4CCh. 1 - Risks Associated with Acquisitions Not all...Ch. 1 - Prob. 1.8CCh. 1 - Prob. 1.1.1ECh. 1 - Prob. 1.1.2ECh. 1 - Prob. 1.1.3ECh. 1 - Multiple-Choice Questions on Complex Organizations...Ch. 1 - Prob. 1.1.5ECh. 1 - Prob. 1.2.1ECh. 1 - Prob. 1.2.2ECh. 1 - Multiple-Choice Questions on Recording Business...Ch. 1 - Prob. 1.2.4ECh. 1 - Multiple-Choice Questions on Recording Business...Ch. 1 - Multiple-Choice Questions on Reported Balances...Ch. 1 - Multiple-Choice Questions on Reported Balances...Ch. 1 - Prob. 1.3.3ECh. 1 - Prob. 1.3.4ECh. 1 - Prob. 1.4.1ECh. 1 - Prob. 1.4.2ECh. 1 - Prob. 1.4.3ECh. 1 - Prob. 1.4.4ECh. 1 - Prob. 1.4.5ECh. 1 - Prob. 1.5ECh. 1 - Prob. 1.6ECh. 1 - Prob. 1.7ECh. 1 - Prob. 1.8ECh. 1 - Prob. 1.9ECh. 1 - Prob. 1.10ECh. 1 - Prob. 1.11ECh. 1 - Goodwill Recognition Spur Corporation reported the...Ch. 1 - Acquisition Using Debentures Planter Corporation...Ch. 1 - Bargain Purchase Using the data resented in E1-13,...Ch. 1 - Prob. 1.15ECh. 1 - Prob. 1.16ECh. 1 - Prob. 1.17ECh. 1 - Prob. 1.18ECh. 1 - Prob. 1.19ECh. 1 - Prob. 1.20ECh. 1 - Prob. 1.21ECh. 1 - Prob. 1.22ECh. 1 - Prob. 1.23ECh. 1 - Prob. 1.24PCh. 1 - Prob. 1.25PCh. 1 - Prob. 1.26PCh. 1 - Prob. 1.27PCh. 1 - Prob. 1.28PCh. 1 - Prob. 1.29PCh. 1 - Prob. 1.30PCh. 1 - Prob. 1.31PCh. 1 - Prob. 1.32PCh. 1 - Prob. 1.33PCh. 1 - Prob. 1.34PCh. 1 - Prob. 1.35PCh. 1 - Business Combination Following are the balance...Ch. 1 - Prob. 1.37PCh. 1 - Prob. 1.38PCh. 1 - Prob. 1.39PCh. 1 - Prob. 1.40P
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