Question
On January 1, 20X1, Honey Bee Corporation purchased the net assets of Green Hornet Company for $1,500,000. On this date, a condensed balance sheet for
On January 1, 20X1, Honey Bee Corporation purchased the net assets of Green Hornet Company for $1,500,000. On this date, a condensed balance sheet for Green Hornet showed:
|
| Book | Fair |
|
| Value | Value |
| Current Assets | $ 500,000 | $800,000 |
| Long-Term Investments in Securities | 200,000 | 150,000 |
| Land | 100,000 | 600,000 |
| Buildings (net) | 700,000 | 900,000 |
|
| $1,500,000 |
|
|
|
|
|
| Current Liabilities | $ 300,000 | $300,000 |
| Long-Term Debt | 550,000 | 600,000 |
| Common Stock (no-par) | 300,000 |
|
| Retained Earnings | 350,000 |
|
|
| $1,500,000 |
|
Required:
Record the entry on Honey Bee's books for the acquisition of Green Hornet's net assets.
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Sound Investing, Chapter 17 - Off-Balance-Sheet Shams
Authors: Kate Mooney
1st Edition
0071719393, 9780071719391
