Pratt Company acquired all of the outstanding shares of Spider, Incorporated, on December 31, 2024, for...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Pratt Company acquired all of the outstanding shares of Spider, Incorporated, on December 31, 2024, for $527,650 cash. Pratt will operate Spider as a wholly owned subsidiary with a separate legal and accounting identity. Although many of Spider's book values approximate fair values, several of its accounts have fair values that differ from book values. In addition, Spider has internally developed assets that remain unrecorded on its books. In deriving the acquisition price, Pratt assessed Spider's fair and book value differences as follows: Computer software Items Equipment Client contracts In-process research and development Notes payable Book Values Fair Values $ 34,000 86,400 $ 87,250 70,900 (94,500) 111,800 53,750 (104,250) At December 31, 2024, the following financial information is available for consolidation (credit balances in parentheses): Items Pratt Cash $ 16,100 Spider $ 37,700 Receivables Inventory 118,000 154,000 57,000 76,000 Investment in Spider 527,650 Computer software 210,500 34,000 Buildings (net) 596,500 150,000 Equipment (net) 340,000 86,400 Client contracts Goodwill Total assets Accounts payable Notes payable 8 8 $ 1,962,750 $ 441,100 Common stock Additional paid-in capital $ (93,000) (530,250) (380,000) (170,000) Retained earnings (789,500) Total liabilities and equities $ (1,962,750) $ (69,000) (94,500) (100,000) (25,000) (152,600) $ (441,100) Required: Prepare a consolidated balance sheet for Pratt and Spider as of December 31, 2024. Cash Receivables Inventory Investment in Spider Computer software Assets PRATT COMPANY AND SUBSIDIARY Consolidated Balance Sheet December 31, 2024 Liabilities and Owners' Equity Accounts payable Notes payable Common stock Additional paid-in capital Retained earnings Buildings (net) Equipment (net) Client contracts Research and development asset Goodwill Total assets $ 0 Total liabilities and equities $ 0 Pratt Company acquired all of the outstanding shares of Spider, Incorporated, on December 31, 2024, for $527,650 cash. Pratt will operate Spider as a wholly owned subsidiary with a separate legal and accounting identity. Although many of Spider's book values approximate fair values, several of its accounts have fair values that differ from book values. In addition, Spider has internally developed assets that remain unrecorded on its books. In deriving the acquisition price, Pratt assessed Spider's fair and book value differences as follows: Computer software Items Equipment Client contracts In-process research and development Notes payable Book Values Fair Values $ 34,000 86,400 $ 87,250 70,900 (94,500) 111,800 53,750 (104,250) At December 31, 2024, the following financial information is available for consolidation (credit balances in parentheses): Items Pratt Cash $ 16,100 Spider $ 37,700 Receivables Inventory 118,000 154,000 57,000 76,000 Investment in Spider 527,650 Computer software 210,500 34,000 Buildings (net) 596,500 150,000 Equipment (net) 340,000 86,400 Client contracts Goodwill Total assets Accounts payable Notes payable 8 8 $ 1,962,750 $ 441,100 Common stock Additional paid-in capital $ (93,000) (530,250) (380,000) (170,000) Retained earnings (789,500) Total liabilities and equities $ (1,962,750) $ (69,000) (94,500) (100,000) (25,000) (152,600) $ (441,100) Required: Prepare a consolidated balance sheet for Pratt and Spider as of December 31, 2024. Cash Receivables Inventory Investment in Spider Computer software Assets PRATT COMPANY AND SUBSIDIARY Consolidated Balance Sheet December 31, 2024 Liabilities and Owners' Equity Accounts payable Notes payable Common stock Additional paid-in capital Retained earnings Buildings (net) Equipment (net) Client contracts Research and development asset Goodwill Total assets $ 0 Total liabilities and equities $ 0
Expert Answer:
Related Book For
Advanced Accounting
ISBN: 9781264798483
15th Edition
Authors: Joe Ben Hoyle, Thomas Schaefer And Timothy Doupnik
Posted Date:
Students also viewed these accounting questions
-
Case B - Record the issuance of the common stock to acquire assets. Journal Entry Accounts Debit Credit Case B - Issue stock to acquire the assets in a single transaction: ArlingtonArlington Company...
-
Let D be the region between the curves y = 6 - x and y = 9 - (x/2)^2. Consider the surface z given as a function of x and y as z = 4xy + 10 and lies above the region D. 1. Sketch the region of...
-
Pratt Company acquired all of the outstanding shares of Spider, Inc., on December 31, 2021, for $495,000 cash. Pratt will operate Spider as a wholly owned subsidiary with a separate legal and...
-
The owner of a moving company typically has his most experienced manager predict the total number of labor hours that will be required to complete an upcoming move. This approach has proved useful in...
-
Judy Gomez, head of marketing for Wildlife Treasures, Inc., has been informed by the board of directors that they would like a marketing research study conducted to determine the cause of the plateau...
-
The end point of a spring oscillates with a period of 2.0 s when a block with mass m is attached to it. When this mass is increased by 2.0 kg, the period is found to be 3.0 s. Find m.
-
Determine most profitable final product (Learning Objective 7) Chocolite processes cocoa beans into cocoa powder at a processing cost of $10,000 per batch. Chocolite can sell the cocoa powder as is,...
-
Stocks A and B have the following historical returns: a. Calculate the average rate of return for each stock during the 5-year period. b. Assume that someone held a portfolio consisting of 50 percent...
-
(4 points) Which of the following graphs is a possible graph of the derivative of the function f graph below. Write ONE LETTER in the answer box below. y =f(x) (a) (b) (c) (d)
-
The module for this chapter focuses on interpersonal skills. The concepts segment discusses the Competing Values Framework, and identifies the broad range of skills managers need to lead their...
-
What is data redundancy, and which characteristics of the file system can lead to it? What can a database administrator do to avoid data redundancy? please explain everything clearly and provide...
-
As part of the purchase of a home on January 1, 2014, you negotiated a mortgage in the amount of $110 000. The amortization period for calculation of the level payments (principal and interest) was...
-
16. Santa Claus believes that some of the elves are trying to sabotage Christmas by deliberately putting fewer candies in the bags he leaves in children's
-
Based on the historical movement ofAUD/EUR exchange rate, predict what the rate will be on 31 December. a) Discuss the effect of Interest Rate Parity on AUD/EUR exchange rate on 31 December 2021
-
The population of Cary in 1980 was 21763. In 1987, the population had grown to 39387. Using the uninhibited growth model, predict the population of Cary for the year 2005.
-
Can you elaborate on the SWIFT message format and the structured data elements used within various SWIFT message categories (e.g., MT103 for payments, MT202 for funds transfer), and how these...
-
How do you find the PVF % of NPV from following problem? Barngrover Inc. is considering a new investment whose data are shown below. The required equipment will be used for 3 years during the proje...
-
Troy is a qualified radiologist who operates a successful radiology practice from purpose- built rooms attached to his house. Troy works in the practice three days a week, and the other two days he...
-
Compute profitability ratios (Learning Objective 4) Compute four ratios that measure Bonapartes ability to earn profits. The companys comparative income statement follows. The data for 2004 are given...
-
Compute stock ratios (Learning Objective 4) Evaluate the common stock of Shamrock State Bank as an investment. Specifically, use the three stock ratios to determine whether the common stock has...
-
Find missing values (Learning Objective 4) The following data (dollar amounts in millions) are adapted from the financial statements of Super Saver Stores, Inc. Requirements Complete Super Savers...
Native American Fish And Wildlife Resource Management Act 1st Edition - ISBN: 1240499094 - Free Book
Study smarter with the SolutionInn App