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Assume that Parent Company decides to acquire Sub Company for $564,000 of debentures Sub Company Balance Sheet Prepare the consolidating journal entries for a 100%
Assume that Parent Company decides to acquire Sub Company for $564,000 of debentures | ||||||||
Sub Company Balance Sheet | Prepare the consolidating journal entries for a 100% Asset Acquisition | |||||||
Assets, Liabilities & Equities | Book Value | Fair Value | Account | Amount | DR | CR | ||
Cash | $40,000 | $40,000 | ||||||
AR | $15,000 | $10,000 | ||||||
Inventory | $105,000 | $200,000 | ||||||
Land | $60,000 | $100,000 | ||||||
Plant and Equipment | $400,000 | $300,000 | ||||||
Less: Accumulated Depreciation | -$150,000 | |||||||
Goodwill | $10,000 | |||||||
Patent | $0 | $0 | ||||||
Total Assets | $480,000 | $650,000 | ||||||
AP | $50,000 | $50,000 | ||||||
Common Stock | $100,000 | |||||||
Additional Paid In Capital | $60,000 | |||||||
Retained Earnings | $270,000 | |||||||
Total Liabilities & Equity | $480,000 | |||||||
Assume that Parent Company decides to acquire Sub Company for $580,000 of debentures | ||||||||
Sub Company Balance Sheet | Prepare the consolidating journal entries for a 100% Asset Acquisition | |||||||
Assets, Liabilities & Equities | Book Value | Fair Value | Account | Amount | DR | CR | ||
Cash | $40,000 | $40,000 | ||||||
AR | $15,000 | $10,000 | ||||||
Inventory | $105,000 | $200,000 | ||||||
Land | $60,000 | $100,000 | ||||||
Plant and Equipment | $400,000 | $300,000 | ||||||
Less: Accumulated Depreciation | -$150,000 | |||||||
Goodwill | $10,000 | |||||||
Patent | $0 | $0 | ||||||
Total Assets | $480,000 | $650,000 | ||||||
AP | $50,000 | $50,000 | ||||||
Common Stock | $100,000 | |||||||
Additional Paid In Capital | $60,000 | |||||||
Retained Earnings | $270,000 | |||||||
Total Liabilities & Equity | $480,000 | |||||||
Assume that Parent Company decides to acquire Sub Company for $625,000 of debentures | ||||||||
Sub Company Balance Sheet | Prepare the consolidating journal entries for a 100% Asset Acquisition (using Cash) | |||||||
Assets, Liabilities & Equities | Book Value | Fair Value | Account | Amount | DR | CR | ||
Cash | $40,000 | $40,000 | ||||||
AR | $15,000 | $10,000 | ||||||
Inventory | $105,000 | $200,000 | ||||||
Land | $60,000 | $100,000 | ||||||
Plant and Equipment | $400,000 | $300,000 | ||||||
Less: Accumulated Depreciation | -$150,000 | |||||||
Goodwill | $10,000 | |||||||
Patent | $0 | $0 | ||||||
Total Assets | $480,000 | $650,000 | ||||||
AP | $50,000 | $50,000 | ||||||
Common Stock | $100,000 | |||||||
Additional Paid In Capital | $60,000 | |||||||
Retained Earnings | $270,000 | |||||||
Total Liabilities & Equity | $480,000 | |||||||
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