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Please indicate which method (equity, partial equity, or initial value) you choose for parlez to use to account for its acquisition of says company. Part
Please indicate which method (equity, partial equity, or initial value) you choose for parlez to use to account for its acquisition of says company.
Part A:
Part B:
Parlez Company acquired of the common stock of Says Company on January 1, year one, for 100% $600,000 credit $100,000 On that date, Says had the following trial balance: account debit Additional paid in capital Building (12-year life) $250,000 Common stock Current assets 170,000 Equipment (6-yr life) 160.000 Land 110,000 Liabilities (due in 4 years) Retained earnings 1/year 1 190.000 300.000 120,000 Totals $690.000 $690,000 During year one, Says reported net income of During year one: Says paid dividends of $50,000 $30,000 During year two, Says reported net income of During year two, Says paid dividends of $80,000 $40,000 On January 1 year one, fair values were Land Building Equipment $122.000 $262.000 $172,000 There was no impairment of any goodwill arising from the acquisition Please indicate clearly which method (Equity, Partial Equity or Initial Value) you choose for Parlez to use to account for its acquisition of Says Company Part A Use the data for the Parlez Company acquisition of the Says Company to prepare the consolidation worksheet entries for December 31 of year one Part B. Use the data for the Parlez Company acquisition of the Says Company to prepare the consolidation worksheet entries for December 31 of year twoStep by Step Solution
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