Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Penny Corporation, a U.S. company, acquired 87% of Sawyer Company's common stock for $216,000 in cash on January 1,2023 . At that date, Sawyer had
Penny Corporation, a U.S. company, acquired 87% of Sawyer Company's common stock for $216,000 in cash on January 1,2023 . At that date, Sawyer had $145,000 of reported net assets (book value). These reported net assets were fairly stated, except land was overvalued by $13,000, unrecorded licensing agreements were valued at $26,000 and unrecorded favorable location was valued at $12,000. The estimated fair value of the noncontrolling interest is $30,000 at the acquisition date. Calculate total goodwill and its allocation to the controlling and noncontrolling interests. You must show your work to receive credit. Ping Corporation paid $371,000 cash for 70% of the outstanding common stock of Spring Company on January 1, 2023. There was no control premium and the fair value of the noncontrolling interest was $159,000 on January 1, 2023. Differences between book value and fair value of the net identifiable assets of Spring Company on January 1, 2021, were limited to the following: Required: (i) Prepare the working paper elimination entries E and R (in journal entry format) for Ping Corporation and subsidiary on January 1, 2023. (ii) Complete the following working paper: Working paper for consolidated balance sheet on date of business combination, January 1,2023
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