Questions from Financial Reporting

Q: Amiel Company acquired 90% of the common stock of Talia Corporation

Amiel Company acquired 90% of the common stock of Talia Corporation on December 31, 20X0. The balance sheets of the two companies immediately after the acquisition was made are shown below: The follow...

Q: Second National Insurance Company provided this information for its minority-passive

Second National Insurance Company provided this information for its minority-passive equity securities: Required: 1. Provide the journal entries to record the fair value adjustment on December 31, 20...

Q: Following are Crash Zone Corporation’s balance sheet at the end of 20X0

Following are Crash Zone Corporation’s balance sheet at the end of 20X0 and its cash flow statement for 20X1. Crash Zone manufactures safety equipment for race cars. Structure of th...

Q: On December 31, 20X1, Pate Corporation acquired 80% of

On December 31, 20X1, 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, 20X1, Newyork Capital Corporation purchased 30%

On January 1, 20X1, 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, 20X1, Delta Inc. acquired 80%

On January 1, 20X1, 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, 20X1: On January 2, 20X1, 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, 20X1, acquisition of Salad: Consider the following cases: Case 1 Plate buys 100% of...

Q: On January 1, 20X1, Pluto Company acquired all of Saturn

On January 1, 20X1, 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: Wilde Company acquired 30% of Micki, Inc., on January

Wilde Company acquired 30% of Micki, Inc., on January 1, 20X1, at a cost of $40 million. At the time, Micki’s balance sheet was as follows: Only one of Micki’s sepa...