3. On January 1, 2010 hand acquires 100% of finger in a statutory merger. At acquisition date the following were the book values and fair values of fixed assets of these two companies;

Book value Fair value

Hand 900,000800,000

Finger200,000300,000

a. What is consolidated fixed assets under the acquisition method

b. What is consolidated fixed assets under the purchase method

c. What is consolidated fixed assets under the pooling of interest method

4. Davis acquires 100% of Reynolds in acquisition. At date of acquisition, Reynolds had in process research and development costs they had spent 300, 000 for 3 years ago and is now recorded on its books at 100,000. This R and D has not yet reached technological feasibility and no alternative use has been identified. At acquisition date, Reynolds continues to work on this project and the fair value is considered to be 200,000. How much will Davis recorded this four at acquisition under the;

a. acquisition method

b. purchase method

c. pooling of interest method

d. do either of answers a,b,c above differ is this transaction was structured as either a statutory merger or a statutory consolidation

5. Holmes acquires 100% of Watson in a transaction structured as an acquisition at January 1, 2010 for a payment as follows; payment to watson shareholders of 6 million cash, notes payable of four million due in 3 years at a market interest rate, and 100,000 shares of holmes common stock with a $5 par an A $20 fair value.

A. under the acquisition method, how much is debited to homes investment account at January 1, 2010

B. Under the purchase method, how much is debited to homes investment account at January 1, 2010

c. Under both methods how much is the consolidated investment in Watson.