Advance Accounting Assignment On Business Combination Homework Help
- August 8, 2017
- Posted by:
- Category: Accounting QA
Best UK USA UAE Australia Canada China Advance Accounting Assignment On Business Combination Homework Help Service Online
1. Business Combination with Goodwill
Anchor Corporation paid cash of $178,000 to acquire Zink Company’s net assets on February 1, 2013. The balance sheet data for the two companies and fair value information for Zink immediately before the business combination were
Anchor Corporation | Zink Company | ||
Balance Sheet Item | Book Value | Book Value | Fair Value |
Cash | $ 240,000 | $ 20,000 | $ 20,000 |
Accounts Receivable | 140,000 | 35,000 | 35,000 |
Inventory | 170,000 | 30,000 | 50,000 |
Patents | 80,000 | 40,000 | 60,000 |
Buildings & Equipment | 380,000 | 310,000 | 150,000 |
Less: Accumulated Depreciation | (190,000) | (200,000) | |
Total Assets | $ 820,000 | $ 235,000 | $315,000 |
Accounts Payable | $ 85,000 | $ 55,000 | $ 55,000 |
Notes Payable | 150,000 | 120,000 | 120,000 |
Common Stock: | |||
$10 par value | 200,000 | ||
$6 par value | 18,000 | ||
Additional Paid-In Capital | 160,000 | 10,000 | |
Retained Earnings | 225,000 | 32,000 | |
Total Liabilities & Equities | $ 820,000 | $ 235,000 |
Required
a. Give the journal entry recorded by Anchor Corporation when it acquired Zink’s net assets.
b. Prepare a balance sheet for Anchor immediately following the acquisition.
c. Give the journal entry to be recorded by Anchor if it acquires all of Zink’s common stock (instead of Zink’s net assets) for $178,000.
2. Combined Balance Sheet
The following balance sheets were prepared for Adam Corporation and Best Company on January 1, 2012, just before they entered into a business combination
Adam Corporation | Best Company | |||
Item | Book Value | Fair Value | Book Value | Fair Value |
Cash & Receivables | $150,000 | $150,000 | $ 90,000 | $ 90,000 |
Inventory | 300,000 | 380,000 | 70,000 | 160,000 |
Buildings & Equipment | 600,000 | 430,000 | 250,000 | 240,000 |
Less: Accumulated Depreciation | (250,000) | (80,000) | ||
Total Assets | $800,000 | $960,000 | $330,000 | $490,000 |
Accounts Payable | $ 75,000 | $ 75,000 | $ 50,000 | $ 50,000 |
Notes Payable | 200,000 | 215,000 | 30,000 | 35,000 |
Common Stock: | ||||
$8 par value | 180,000 | |||
$6 par value | 90,000 | |||
Additional Paid-In Capital | 140,000 | 55,000 | ||
Retained Earnings | 205,000 | 105,000 | ||
Total Liabilities & Equities | $800,000 | $330,000 |
Adam acquired all of Best Company’s assets and liabilities on January 1, 2012, in exchange for its common shares. Adam issued 8,000 shares of stock to complete the business combination.
Required
Prepare a balance sheet of the combined company immediately following the acquisition, assuming Adam’s shares were trading at $60 each.
3.Journal Entries to Record a Business Combination
On January 1, 20X2, Frost Company acquired all of TKK Corporation’s assets and liabilities by issuing 24,000 shares of its $4 par value common stock. At that date, Frost shares were selling at $22 per share. Historical cost and fair value balance sheet data for TKK at the time of acquisition were as follows
Balance Sheet Item | Historical Cost | Fair Value |
Cash & Receivables | $ 28,000 | $ 28,000 |
Inventory | 94,000 | 122,000 |
Buildings & Equipment | 600,000 | 470,000 |
Less: Accumulated Depreciation | (240,000) | |
Total Assets | $ 482,000 | $620,000 |
Accounts Payable | $ 41,000 | $ 41,000 |
Notes Payable | 65,000 | 63,000 |
Common Stock ($10 par value) | 160,000 | |
Retained Earnings | 216,000 | |
Total Liabilities & Equities | $ 482,000 |
Frost paid legal fees for the transfer of assets and liabilities of $14,000. Frost also paid audit fees of $21,000 and listing application fees of $7,000, both related to the issuance of new shares.
Required
Prepare the journal entries made by Frost to record the business combination.
How it Works?
How it Works?
Step 1:- Want to buy solution for this. Please click on submit your assignment here and then fill all details and please mentioned product code at the end of the case. Product code is extremely important to locate your assignment. You can also mail us by keeping product code as mail subject to besthomewrokhelpers@gmail.com
Step 2:- As soon as we received your details, we will inform you with through email about quotations of the given assignment. Requesting you to please mention your budget. Also ensure our email besthomeworkhelpers@gmail.com should not go into your spam folder.
Step 3:- Once you agree with our price, click on pay now and pay the agreed amount and once we received the payment assignment will be delivered before agreed deadline.
Step 4:-You can also call us in our phone no. as given in the top of the home page or chat with our customer service representatives by clicking on chat now given in the bottom right corner.
Features
Our Features for Assignment Help Services
Plagiarism Free Solution
The first and foremost things that we promise to our customer is plagiarism free solution i.e. a complete and unique solution as per customer’s university requirements.
Excellent Customer Care Services
You can feel our responsiveness once you use our service. Our team of excellent and dedicated customer service representatives are always ready to provide best customer care service 24X7 . Just drop a mail to besthomeworkhelpers@gmail.com and you can receive response in just no time.
Multiple Stage Quality Assurance
We design a unique multiple stage quality assurance team to ensure plagiarism free, original, relevant and as per customer’s requirements. We not only give importance to accurate solutions or writing but also we give equal importance to references style too.
Privacy and Confidentiality
We believe in maintaining complete privacy and confidentiality of all our clients. None of the information furnished to us is shared with anyone else.
Our Clients
We receive requests from clients all over the World. Most of our customers are from USA, UK, Australia, Canada, UAE, Muscat, Oman, Qatar, UAE, New-Zealand, France Germany etc.
Related Services
- Accounting Homework Help
- Accounting Assignment Help
- Computer Science Homework Help
- Management Homework Help
- Finance Assignment Help
- Online Essay Writing Help
- Strategic management case study help
- Case Study Assignment Help
- Dissertation Writing Help
- Trade finance case study help
- Project Management Assignment Help
- Mechanical Engineering Homework Help
- Online Quiz Help
- Maths homework Help
- Online Exam Help
- Economics Assignment Help
- Economics Homework Help
- English Homework Help
- Macroeconomics Homework Help
- Microeconomics Homework Help
- Statistics Assignment Help
- Australia Taxation Homework Help
- Supply chain management homework help
- Taxation homework help
- USA taxation assignment help
- Advanced accounting homework help online
- Auditing homework writing help
- Human resource management homework help
- Nursing homework help online
- Psychology homework help online
- Sociology homework help online
- Ratio analysis homework help online
- Strategic Management Homework Help Online
- Mba operations management homework help
- Human resource management homework help
- Operations management homework help
4.Consolidated Balances For Business Combination
Father, Inc., buys 80 percent of the outstanding common stock of Sam Corporation on January 1, 2011, for $680,000 cash. At the acquisition date, Sam’s total fair value was assessed at $850,000 although Sam’s book value was only $600,000. Also, several individual items on Sam’s financial records had fair values that differed from their book values as follows
Book Value | Fair Value | |
Land | $ 60,000 | $ 225,000 |
Buildings and equipment (10-year remaining life) | 275,000 | 250,000 |
Copyright (20-year life) | 100,000 | 200,000 |
Notes payable (due in 8 years) | (130,000) | (120,000) |
For internal reporting purposes, Father, Inc., employs the equity method to account for this investment. The following account balances are for the year ending December 31, 2011, for both companies. Using the acquisition method, determine consolidated balances for this business combination (through either individual computations or the use of a worksheet).
Father | Sam | |
Revenues | $(1,360,000) | $(540,000) |
Cost of goods sold | 700,000 | 385,000 |
Depreciation expense | 260,000 | 10,000 |
Amortization expense | –0– | 5,000 |
Interest expense | 44,000 | 5,000 |
Equity in income of Sam | (105,000) | –0– |
Net income | $ (461,000) | $(135,000) |
Retained earnings, 1/1/11 | $(1,265,000) | $(440,000) |
Net income (above) | (461,000) | (135,000) |
Dividends paid | 260,000 | 65,000 |
Retained earnings, 12/31/11 | $(1,466,000) | $(510,000) |
Current assets | $ 965,000 | $ 528,000 |
Investment in Sam | 733,000 | –0– |
Land | 292,000 | 60,000 |
Buildings and equipment (net) | 877,000 | 265,000 |
Copyright | –0– | 95,000 |
Total assets | $ 2,867,000 | $ 948,000 |
Accounts payable | $ (191,000) | $(148,000) |
Notes payable | (460,000) | (130,000) |
Common stock | (300,000) | (100,000) |
Additional paid-in capital | (450,000) | (60,000) |
Retained earnings (above) | (1,466,000) | (510,000) |
Total liabilities and equities | $(2,867,000) | $(948,000) |
Product Code: ACC231
Looking for Advance Accounting Assignment On Business Combination Homework Help, please submit your details here with product code mentioned above.