midterm solution fall 2015 - Question 1 Cost Implied value...

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Question 1Cost1,200,000 Implied value2,000,000 Common shares1,500,000 Retained Earnings(500,000) 1,000,000 Purchase Discrepancy1,000,000 Allocated:Inventories50,000 Plant and Equipment(250,000)Long Term Liabilities(100,000)Copyright200,000 Goodwill1,100,000 Potvin Shroder Adjustments Consolidated Cash300,000 100,000 - 400,000 Accounts Receivable2,000,000 200,000 (10,000) 2,190,000 Inventories3,000,000 400,000 50,000 3,450,000 Investment in Shroder1,200,000 - (1,200,000) - Plant and Equipment6,000,000 1,300,000 (750,000) 6,550,000 Accumulated Depreciation(2,000,000) (500,000) 500,000 (2,000,000)Intangible assets (copyright)- ### 200,000 200,000 Goodwill- ### 1,100,000 1,100,000 Total Assets10,500,000 1,500,000 11,890,000 Accounts Payable1,500,000 200,000 (10,000) 1,690,000 Long-term Liabilities2,000,000 300,000 100,000 2,400,000 Common Stock3,000,000 1,500,000 (1,500,000) 3,000,000 Retained Earnings4,000,000 (500,000) 500,000 4,000,000 NCI- ### 800,000 800,000 Total liability and shareholder equity10,500,000 1,500,000 11,890,000 NCICS - sub1,500,000 RE - sub(500,000)Unamortized purchase discrepancy1,000,000 Adjusted2,000,000 NCI %40%NCI800,000
Question 2 Cost of 100%1,085,000Income StatementBook value of SYear ended December 31, 2006Common shares400,000UP (loss)UPRetained earnings620,000ParentSubDivPD amortI/C sales2005

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