Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Popper Co. acquired 80% of the common stock of Cocker Co. on January 1, 2004, when Cocker had the following stockholders' equity accounts. common stock.................................140,000

Popper Co. acquired 80% of the common stock of Cocker Co. on January 1, 2004, when Cocker had the following stockholders' equity accounts.

common stock.................................140,000

additional PIC...................................105,000

Retained Earnings..........................476,000

Total stockholders equity...............721,000 To acquire this interest in Cocker, Popper paid a total of $682,000 with any excess acquisition date fair value over book value being allocated to goodwill, which has been measured for impairment annually and has not been determined to be impaired as of January 1, 2009. On January 1, 2009, Cocker reported a net book value of $1,113,000 before the following transactions were conducted. Popper uses the equity method to account for its investment in Cocker, thereby reflecting the change in book value of Cocker. 21. On January 1, 2009, Cocker issued 10,000 additional shares of common stock for $21 per share. Popper did not acquire any of this newly issued stock. How would this transaction affect the additional paid-in capital of the parent company?

The correct answer is decrease it by $43,680.

Please show step -by-step calculations for problem. Correct answer is already given. Thanks

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

Knowledge Assets And Knowledge Audits Working Methods For Knowledge Management

Authors: Pawan Handa, Jean Pagani, Denise Bedford

1st Edition

1789737745, 978-1789737745

More Books

Students also viewed these Accounting questions