2ewrap led Arial Paste EEE A BIU Font Alignment Clipboard f Given Data PO2-34: A1 E C H C E A 1 Given Data P02-34: 2 Seguros Company outstanding voting shares 3 acquired by Pacifica Inc. Pacifica Company's $5 par common stock issued for acquisition -number of shares Market value of Pacifica stock at acquisition date Cash paid by Pacifica when Seguros meets certain goals Fair value of Seguros R & D project Probability that Seguros will meet goals Discount rate used to represent time value of money 100% 4 5 50,000 20 130,000 100,000 50% 8 9 10 4% 11 Legal fees paid by Pacifica in connection with acquisition S S 15,000 9,000 12 Stock issuance costs paid by Pacifica 13 14 Seguros Company Book 15 Fair 16 Values 17 Pacifica, Inc. Values $(1,200,000) 875,000 $ (325,000) $ (950,000) (325,000) 90,000 18 Revenues Expenses Net income 19 20 21 Retained earnings, 1/1 Net income 22 Dividends paid Retained earnings, 12/31 23 $(1, 24 25 $ 110,000 $ 750,000 1,400,000 300,000 $ 2,560,000 S (500,000) $ (180,000) $ (180,000) (400,000) A75 000 PO2-29 85,000 $ 190,000 450,000 160,000 885,000 85,000 180,000 600,000 200,000 26 Cash Receivables and inventory Property, plant, and equipment Trademarks 27 28 29 30 Total assets 31 Liabilities $ (200,000) 32 Common stock Additinnal naid.in canital PO2-28 (7n nnn 33. Given PO2-34 Given P02-28 Given PO2-29 PO2-34 e Paste BIU Alignment Font Clipboard Given Data PO2-34: A1 G F D E B A Pacifica Company's $5 par common stock issued for acquisition - number of shares Market value of Pacifica stock at acquisition date Cash paid by Pacifica when Seguros meets certain goals Fair value of Seguros R & D project Probability that Seguros will meet goals Discount rate used to represent time value of money Legal fees paid by Pacifica in connection with acquisition Stock issuance costs paid by Pacifica 5 50,000 20 6 7 130,000 100,000 50% 10 4% 11 $ 15,000 9,000 12 13 14 Seguros Company Book 15 Fair 16 Values Values Pacifica, Inc. $ (1,200,000) 875,000 $ (325,000) $ (950,000) (325,000) 90,000 $ (1.185,000) 17 Revenues 18 19 Expenses Net income 20 Retained earnings, 1/1 Net income Dividends paid Retained earnings, 12/31 21 22 23 24 25 26 85,000 180,000 600,000 200,000 110,000 $ 750,000 1,400,000 300,000 $ 2,560,000 $ (500,000) $ (400,000) (475,000) (1,185,000) $ (2,560,000) $ (885,000) 85,000 $ 190,000 450,000 Cash Receivables and inventory 27 Property, plant, and equipment Trademarks 28 160,000 885,000 29 Total assets 30 (180,000) $ (180,000) (200,000) (70,000) (435,000) 31 Liabilities Common stock Additional paid-in capital Retained earnings Total liabilities and equities 32 33 34 35 36 27 Given PO2-34 Given PO2-29 PO2-34 Given PO2-28 PO2-29 P02-28 1 A B E F Problem 02-34 Part C only: PACIFICA, INC., AND SEGUROS co. Consolidation Worksheet December 31 Consolidation Entries Debit Consolidated Accounts Revenues Expenses Net income Pacifica, Seguros Credit Totals Retained earnings, 1/1 Net income Dividends paid Retained earnings, 12/31 Cash Receivables and inventory Property, plant and Equipment Investment in Seguros Research and development asset Goodwill Trademarks Total assets Liabilities Contingent performance obligation Common stock Given PO2-29 Given PO2-34 PO2-34 Given PO2-28 PO2-29 PO2-28 D0Oard Font Alignment Number Styles Cells X A D E F G K Property, plant and Equipment Investment in Seguros Research and development asset Goodwill Trademarks Total assets Liabilities Contingent performance obligation Common stock Additional paid-in capital Retained earnings Total liabilities and equities Given PO2-34 PO2-29 Given PO2-29 PO2-34 Given P02-28 PO2-28
