Question
Pencil Company acquired 70 percent of Stylus Corporations stock on January 2, 20X3, for $70,700 cash. Summarized balance sheet data for the companies on December
Pencil Company acquired 70 percent of Stylus Corporations stock on January 2, 20X3, for $70,700 cash. Summarized balance sheet data for the companies on December 31, 20X2, follow:
| Pencil Company | Stylus Corporation | |||
|---|---|---|---|---|
| Book Value | Fair Value | Book Value | Fair Value | |
| Cash | $ 212,000 | $ 212,000 | $ 51,000 | $ 51,000 |
| Other Assets | 402,000 | 402,000 | 121,000 | 121,000 |
| Total Debits | $ 614,000 | $ 172,000 | ||
| Current Liabilities | $ 91,000 | 91,000 | $ 71,000 | 71,000 |
| Common Stock | 292,000 | 51,000 | ||
| Retained Earnings | 231,000 | 50,000 | ||
| Total Credits | $ 614,000 | $ 172,000 | ||
Required:
Prepare a consolidated balance sheet immediately following the acquisition.
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
Design Of Cost Management Systems The Text Cases And Readings
Authors: Robin Cooper
1st Edition
0132041243, 978-0132041249
