Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

On January 1, 20X2, Plend Corporation acquired all of Stork Corporation's assets and liabilities by issuing shares of its common stock. Partial balance sheet

image text in transcribedimage text in transcribed

On January 1, 20X2, Plend Corporation acquired all of Stork Corporation's assets and liabilities by issuing shares of its common stock. Partial balance sheet data for the companies prior to the business combination and immediately following the combination are as follows: Plend Corp. Stork Corp. Book Value Book Value Combined Entity Assets Cash Accounts Receivable Inventory Buildings & Equipment (net) Goodwill Total Assets Liabilities and Equities Accounts Payable Bonds Payable Bond Premium Common Stock, $5 par Additional Paid-In Capital Retained Earnings $ 41,000 61,000 $ 11,000 31,000 $ 52,000 90,000 51,000 301,000 36,000 111,000 98,000 432,000 $454,000 $189,000 $ ? $ 33,000 151,000 $ 15,000 71,000 7,000 101,000 41,000 $ 48,000 222,000 7,000 127,500 66,000 29,000 256,800 96,000 33,000 ? Total Liabilities & Equities $454,000 $189,000 $ ? e. What amount of goodwill, if any, will be reported by the combined entity immediately following the combination? Amount of goodwill f. What balance in retained earnings will the combined entity report immediately following the combination? Balance in retained earnings g. If the depreciable assets held by Stork had an average remaining life of 10 years at the date of acquisition, what amount of depreciation expense will be reported on those assets in 20X2? Amount of depreciation expense

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

Managerial Accounting Tools for business decision making

Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso

5th edition

470506954, 471345881, 978-0470506950, 9780471345886, 978-0470477144

More Books

Students also viewed these Accounting questions