Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

On 1/1/2017 P Company acquired all the net assets of S Company. P Company also agreed to pay an additional $90000 to the former stockholders

image text in transcribed

On 1/1/2017 P Company acquired all the net assets of S Company. P Company also agreed to pay an additional $90000 to the former stockholders of S Company if the average earnings next two years exceeded $800000. The entry recorded if target is met: Select one: O a. Dr. Cash 90000 Cr. Income 90000 O b. Dr. Contingent liability 90000 Cr. Income 90000 O c. Dr. Goodwill 90000 Cr. Contingent liability 90000 O d. Dr. Contingent liability 90000 Cr. Cash 90000

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Application Of Quantitative Techniques For The Prediction Of Bank Acquisition Targets

Authors: Pasiouras Fotios

1st Edition

9812565183, 9789812565181

More Books

Students also viewed these Accounting questions

Question

Which has the higher tides: spring tides or neap tides?

Answered: 1 week ago