Questions from Financial Reporting

Q: On December 31, 2017, Pate Corporation acquired 80% of

On December 31, 2017, Pate Corporation acquired 80% of Starmont Corporation’s common stock for $900,000 cash. Assume that the fair values of Starmont’s identifiable...

Q: On January 1, 2017, Newyork Capital Corporation purchased 30%

On January 1, 2017, Newyork Capital Corporation purchased 30% of the outstanding common shares of Delta Crating Corp. for $250 million and accounts for this investment under the equity method. The fol...

Q: On January 1, 2017, Delta Inc. acquired 80%

On January 1, 2017, Delta Inc. acquired 80% of Sigma Company’s outstanding stock for $80,000 cash. Following are the balance sheets for Delta and Sigma immediately before the acquisi...

Q: Prince Corp. and Sprite Corp. reported the following balance sheets

Prince Corp. and Sprite Corp. reported the following balance sheets at January 1, 2017: On January 2, 2017, Prince issued $36,000 of stock and used the proceeds to purchase 90% of Spriteâ€...

Q: The following are the balance sheets for Plate and Salad immediately prior

The following are the balance sheets for Plate and Salad immediately prior to Plate’s September 1, 2017, acquisition of Salad: Consider the following cases: Case 1 Plate buys 100%...

Q: Refer to the balance sheets of Plate and Salad in the previous

Refer to the balance sheets of Plate and Salad in the previous problem. Assume that Plate buys 80% of Salad’s common stock for $180,000 cash. The fair value of Salad’s land is $20,000, the fair value...

Q: On January 1, 2017, Pluto Company acquired all of Saturn

On January 1, 2017, Pluto Company acquired all of Saturn Company’s common stock for $1,000,000 cash. On that date, Saturn had retained earnings of $200,000 and common stock of $600,0...

Q: The management of Banciu Corporation provides you with the comparative analysis of

The management of Banciu Corporation provides you with the comparative analysis of changes in account balances between December 31, 2016, and December 31, 2017, appearing below. Supplemental Infor...

Q: Rite Aid Corporation operates retail drugstores in the United States. It

Rite Aid Corporation operates retail drugstores in the United States. It is one of the country’s largest retail drugstore chains with 3,333 stores in operation as of March 3, Year 3....

Q: The following are selected balance sheet accounts of Zach Corporation at December

The following are selected balance sheet accounts of Zach Corporation at December 31, 2017 and 2016, as well as the increases or decreases in each account from 2016 to 2017. Also presented is selected...