Answered step by step
Verified Expert Solution
Question
1 Approved Answer
I need the answer during 30m please TKS Q9. On 1 January 2017, Alfa Ltd took control of the assets and liabilities of Beta Ltd.
I need the answer during 30m please
TKS Q9. On 1 January 2017, Alfa Ltd took control of the assets and liabilities of Beta Ltd. At this date the statement of financial position of Beta Ltd was as follows: Carrying amount Fair value Machinery $20 000 $33,500 Fixtures & fittings 30 000 34,000 Vehicles 17,500 16,250 Current assets 5.000 6,000 Current liabilities (8.000) Total net assets (9,000) $64,500 Share capital (80 000 shares at $0.50 per share) 40,000 General reserve 10,000 Retained earnings 14.500 Total equity S64, 500 Required Prepare the journal entries in the records of Alfa Ltd at 1 July 2017 in each of the following situations, assuming the costs of issuing the shares by Angelina Ltd cost $800: A. Alfa Ltd issued 80,000 shares having a fair value of $1.20 per share in exchange for the net assets of Beta Ltd B. Alfa Ltd issued 80,000 shares having a fair value of $1.00 per share in exchange for the net assets of Beta Ltd. C. Alfa Ltd acquired the shares of Beta Ltd. The agreement was that Alfa Ltd would pay the shareholders of Beta Ltd two share in Alfa Ltd for every three shares held in Beta Ltd plus $0.50 in cash for each share held in Beta Ltd. Shares in Alfa Ltd have a fair value of $0.90 per share. D. What are the areas affects the accounting for a business combination Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started