Advanced Financial Accounting
12th Edition
ISBN: 9781259916977
Author: Christensen, Theodore E., COTTRELL, David M., Budd, Cassy
Publisher: Mcgraw-hill Education,
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Question
Chapter 3, Problem 3.23P
a.
To determine
Introduction:
The consolidated financial statements are prepared for providing a consolidated view of the financials of the company having subsidiary companies. The
To calculate:The amount to be paid by P to purchase shares of S.
b.
To determine
Introduction:
The consolidated financial statements are prepared for providing a consolidated view of the financials of the company having subsidiary companies. The cash flows of all the subsidiary companies are shown as one entity in these statements.
To Calculate:The non-controlling interest in the consolidated balance sheet.
c.
To determine
Introduction:
The consolidated financial statements are prepared for providing a consolidated view of the financials of the company having subsidiary companies. The cash flows of all the subsidiary companies are shown as one entity in these statements.
To Calculate:The consolidated net income reported in the consolidated balance sheet.
d.
To determine
Introduction:
The consolidated financial statements are prepared for providing a consolidated view of the financials of the company having subsidiary companies. The cash flows of all the subsidiary companies are shown as one entity in these statements.
To calculate:The consolidated net income reported in the consolidated balance sheet.
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On January 1, 20X4, Pierce Corporation acquired 90 percent of Sharp Company's voting stock, at underlying book value. The fair value of the
noncontrolling interest was equal to 10 percent of the book value of Sharp at that date. Pierce uses the equity method in accounting for its ownership
of Sharp. On December 31, 20X4, the trial balances of the two companies are as follows:
Item
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Depreciable Assets
Investment in Sharp
Depreciation Expense
Other Expenses
Dividends Declared
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Current Liabilities
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62,000
75,000
100,000
120,000
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$ 120,000
225,000
25,000
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1) Provide all consolidating entries required as of December 31, 20X4, to prepare…
Pie Corporation acquired 75 percent of Slice Company’s common stock on December 31, 20X5, at underlying book value. The book values and fair values of Slice’s assets and liabilities were equal, and the fair value of the noncontrolling interest was equal to 25 percent of the total book value of Slice. Slice provided the following trial balance data at December 31, 20X5:
Debit Credit
Cash $ 27,600
Accounts Receivable 65,650
Inventory 89,400
Buildings and Equipment
(net) 213,000
Cost of Goods Sold 105,700
Depreciation Expense 23,500
Other Operating Expenses 31,220
Dividends Declared 14,100
Accounts Payable $ 33,080
Notes Payable 113,000
Common Stock 84,600
Retained Earnings 125,000
Sales 214,490
Total Assets $ 570, Total Liabilities & Equity $170 $ 570,170
Required: a. How much did Pie pay to purchase its shares of Slice? (Round your answer to nearest whole dollar amount.)
b. If consolidated financial statements are prepared at December 31, 20X5, what amount will be assigned to…
Pizza Corporation acquired 80 percent ownership of Slice Products Company on January 1, 20X1, for $148,000. On that date, the fair value of the noncontrolling interest was $37,000, and Slice reported retained earnings of $45,000 and had $93,000 of common stock outstanding. Pizza has used the equity method in accounting for its investment in Slice. Trial balance data for the two companies on December 31, 20X5, are as follows:
PizzaCorporation
SliceProducts Company
Item
Debit
Credit
Debit
Credit
Cash & Receivables
$
86,000
$
80,000
Inventory
270,000
94,000
Land
83,000
83,000
Buildings & Equipment
501,000
154,000
Investment in Slice Products Company
176,400
Cost of Goods Sold
115,000
45,000
Depreciation Expense
25,000
15,000
Inventory Losses
15,000
6,000
Dividends Declared
45,000…
Chapter 3 Solutions
Advanced Financial Accounting
Ch. 3 - What is the basic idea underlying the preparation...Ch. 3 - How might consolidated statements help an investor...Ch. 3 - Prob. 3.3QCh. 3 - Prob. 3.4QCh. 3 - Prob. 3.5QCh. 3 - Prob. 3.6QCh. 3 - Prob. 3.7QCh. 3 - Prob. 3.8QCh. 3 - Prob. 3.9QCh. 3 - Prob. 3.10Q
Ch. 3 - Prob. 3.11QCh. 3 - Prob. 3.12QCh. 3 - What is meant by indirect control? Give an...Ch. 3 - Prob. 3.14QCh. 3 - Prob. 3.15QCh. 3 - Prob. 3.16QCh. 3 - Prob. 3.17QCh. 3 - Prob. 3.18QCh. 3 - Prob. 3.1CCh. 3 - Prob. 3.2CCh. 3 - Prob. 3.1.1ECh. 3 - Prob. 3.1.2ECh. 3 - Prob. 3.1.3ECh. 3 - Prob. 3.1.4ECh. 3 - Multiple-Choice Question on Variable Interest...Ch. 3 - Multiple-Choice Question on Variable Interest...Ch. 3 - Prob. 3.2.3ECh. 3 - Prob. 3.2.4ECh. 3 - Prob. 3.3.1ECh. 3 - Prob. 3.3.2ECh. 3 - Prob. 3.3.3ECh. 3 - Prob. 3.4.1ECh. 3 - Prob. 3.4.2ECh. 3 - Prob. 3.4.3ECh. 3 - Prob. 3.4.4ECh. 3 - Balance Sheet Consolidation On January 1, 20X3,...Ch. 3 - Prob. 3.6ECh. 3 - Prob. 3.7ECh. 3 - Prob. 3.8ECh. 3 - Prob. 3.9ECh. 3 - Reporting for a Variable Interest Entity Gamble...Ch. 3 - Prob. 3.11ECh. 3 - Prob. 3.12ECh. 3 - Prob. 3.13ECh. 3 - Prob. 3.14ECh. 3 - Prob. 3.15ECh. 3 - Prob. 3.16ECh. 3 - Prob. 3.17ECh. 3 - Prob. 3.18ECh. 3 - Prob. 3.19.1PCh. 3 - Prob. 3.19.2PCh. 3 - Prob. 3.20PCh. 3 - Prob. 3.21PCh. 3 - Prob. 3.22PCh. 3 - Prob. 3.23PCh. 3 - Prob. 3.24PCh. 3 - Prob. 3.25PCh. 3 - Prob. 3.26PCh. 3 - Prob. 3.27PCh. 3 - Prob. 3.28PCh. 3 - Prob. 3.29PCh. 3 - Consolidated Worksheet at End of the First Year of...Ch. 3 - Prob. 3.31P
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Similar questions
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