Questions from Advanced Accounting

Q: Green Company is considering acquiring theassets of Gold Corporation by assuming Gold’s

Green Company is considering acquiring theassets of Gold Corporation by assuming Gold’s liabilities and by making a cash payment. GoldCorporation has the following balance sheet on t...

Q: Small Company acquired a controlling interest in Big Company. Private Company

Small Company acquired a controlling interest in Big Company. Private Company had the following balance sheet on the acquisition date: Big Company had the following book and fair values on the acqui...

Q: Rainman Corporation is considering the acquisition of Largo Company through the acquisition

Rainman Corporation is considering the acquisition of Largo Company through the acquisition of Largo’s common stock. Rainman Corporation will issue 20,000 shares of its $5 par common...

Q: Refer to the preceding information for Paulcraft’s acquisition of Switzer’s common stock

Refer to the preceding information for Paulcraft’s acquisition of Switzer’s common stock. Assume that Paulcraft pays $400,000 for 80% of Switzer common stock. Paulc...

Q: On January 1, 2015, Peanut Company acquired 80% of

On January 1, 2015, Peanut Company acquired 80% of the common stock of Salt Company for $200,000. On this date, Salt had total owners’ equity of $200,000 (including retained earnings...

Q: Lucy Company issues securities with a fair value of $468,

Lucy Company issues securities with a fair value of $468,000 for a 90% interest in Diamond Company on January 1, 2015, at which time Diamond Company has the following balance sheet: It is believed t...

Q: Palto issues 20,000 of its $5 par value common

Palto issues 20,000 of its $5 par value common stock shares, with a fair value of $35 each, for a 100% interest in Sword Company on January 1, 2015. The balance sheet of Sword Company on that date is...

Q: Caswell Company is contemplating the purchase of LaBelle Company as of January

Caswell Company is contemplating the purchase of LaBelle Company as of January 1, 2016. LaBelle Company has provided the following current balance sheet: The following information exists relative to...

Q: On January 1, 2016, the shareholders of Unknown Company request

On January 1, 2016, the shareholders of Unknown Company request 6,000 Famous shares in exchange for all of their 5,000 shares. This is an exchange ratio of 1.2 to 1. The fair value of a share of Famou...

Q: Arther Corporation acquired all of the outstanding $10 par voting common

Arther Corporation acquired all of the outstanding $10 par voting common stock of Trent Inc., on January 1, 2016, in exchange for 50,000 shares of its $10 par voting common stock. On December 31, 2015...