Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

West Company acquired 60 percent of Solar Company for $315,000 when Solars book value was $415,000. The newly comprised 40 percent noncontrolling interest had an

West Company acquired 60 percent of Solar Company for $315,000 when Solars book value was $415,000. The newly comprised 40 percent noncontrolling interest had an assessed fair value of $210,000. Also at the acquisition date, Solar had a trademark (with a 10-year life) that was undervalued in the financial records by $70,000. Also, patented technology (with a 5-year life) was undervalued by $50,000. Two years later, the following figures are reported by these two companies (stockholders equity accounts have been omitted):

West Company Book Value Solar Company Book Value Solar Company Fair Value
Current assets $ 630,000 $ 310,000 $ 330,000
Trademarks 270,000 210,000 290,000
Patented technology 420,000 160,000 160,000
Liabilities (400,000 ) (130,000 ) (130,000 )
Revenues (910,000 ) (410,000 )
Expenses 490,000 310,000
Investment income Not given

What is the consolidated trademarks balance?

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

ISE Fundamental Managerial Accounting Concepts

Authors: Thomas P. Edmonds, Christopher Edmonds, Mark A. Edmonds, Philip R. Olds

10th Edition

1265045925, 9781265045920

More Books

Students also viewed these Accounting questions

Question

Understand the department managers key role in employee retention

Answered: 1 week ago