signment ACT460 Final Assessment-Sp21. X BigBlueButton - Final asses: x nayou/Downloads/ACT460_Final%20Assessment-Sp21-C.pdf + 2 Page view | A Read aloud V V Draw Highligh Question 2 (26 points) On January 1, 2020, Paris Corporation acquired 60 percent of Salt Company's common stock for $90,000 cash. The fair value of the noncontrolling interest at that date was determined to be $60,000. Data from the balance sheets of the two companies included the following amounts as of the date of acquisition: Paris Co. Salt Co. Cash $24,500 $12,000 Accounts Receivable 39,000 29,000 Inventory 28,000 32,000 Land 60,000 40,000 Buildings and Equipment 175,000 75,000 Less: Accumulated Depreciation -45,000 -23,000 Investment in Selfie Corp. 90,000 Total Assets $371,500 $165,000 Accounts Payable Bonds Payable Common Stock Retained Earnings Total Liabilities and Equity $57,000 70,000 150,000 94,500 $371,500 $20,000 15,000 60,000 70,000 $165,000 At the date of the business combination, the book values of Salt's net assets and liabilities approximated fair value except for inventory, which had a fair value of $35,000, and land, which had a fair value of $48,000. Required: A) Prepare the equity method entries on Paris's books for the acquisition of Salt on January 1, 2020. (4 points) B) Give the basic consolidation entry at the date of acquisition. (10 points) C) Give excess value (differential) reclassification entries at the date of acquisition. (8 points) D) Give accumulated depreciation consolidation entry. (4 points) 100 o A & 5 6 7 V 8 A Y U DS c signment ACT460 Final Assessment-Sp21. X BigBlueButton - Final asses: x nayou/Downloads/ACT460_Final%20Assessment-Sp21-C.pdf + 2 Page view | A Read aloud V V Draw Highligh Question 2 (26 points) On January 1, 2020, Paris Corporation acquired 60 percent of Salt Company's common stock for $90,000 cash. The fair value of the noncontrolling interest at that date was determined to be $60,000. Data from the balance sheets of the two companies included the following amounts as of the date of acquisition: Paris Co. Salt Co. Cash $24,500 $12,000 Accounts Receivable 39,000 29,000 Inventory 28,000 32,000 Land 60,000 40,000 Buildings and Equipment 175,000 75,000 Less: Accumulated Depreciation -45,000 -23,000 Investment in Selfie Corp. 90,000 Total Assets $371,500 $165,000 Accounts Payable Bonds Payable Common Stock Retained Earnings Total Liabilities and Equity $57,000 70,000 150,000 94,500 $371,500 $20,000 15,000 60,000 70,000 $165,000 At the date of the business combination, the book values of Salt's net assets and liabilities approximated fair value except for inventory, which had a fair value of $35,000, and land, which had a fair value of $48,000. Required: A) Prepare the equity method entries on Paris's books for the acquisition of Salt on January 1, 2020. (4 points) B) Give the basic consolidation entry at the date of acquisition. (10 points) C) Give excess value (differential) reclassification entries at the date of acquisition. (8 points) D) Give accumulated depreciation consolidation entry. (4 points) 100 o A & 5 6 7 V 8 A Y U DS c
