Question
Peace Computer Corporation acquired 75 percent of Symbol Software Companys stock on January 2, 20X3, by issuing bonds with a par value of $84,500 and
Peace Computer Corporation acquired 75 percent of Symbol Software Companys stock on January 2, 20X3, by issuing bonds with a par value of $84,500 and a fair value of $102,000 in exchange for the shares. Summarized balance sheet data presented for the companies just before the acquisition follow:
| Peace Computer Corporation | Symbol Software Company | ||||||||||||||||
| Book Value | Fair Value | Book Value | Fair Value | ||||||||||||||
| Cash | $ | 207,000 | $ | 207,000 | $ | 66,000 | $ | 66,000 | |||||||||
| Other Assets | 404,000 | 404,000 | 135,000 | 135,000 | |||||||||||||
| Total Debits | $ | 611,000 | $ | 201,000 | |||||||||||||
| Current Liabilities | $ | 85,000 | 85,000 | $ | 65,000 | 65,000 | |||||||||||
| Common Stock | 295,000 | 66,000 | |||||||||||||||
| Retained Earnings | 231,000 | 70,000 | |||||||||||||||
| Total Credits | $ | 611,000 | $ | 201,000 | |||||||||||||
Required: Prepare a consolidated balance sheet immediately following the acquisition.
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Sound Investing, Chapter 24 - The Auditors??? Opinion
Authors: Kate Mooney
2nd Edition
0071719466, 9780071719469
