Chapter 9 Homework - ACCT 4455 Chp 9 Chapter 9: HOMEWORK...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
ACCT 4455 Chp 9 Chapter 9: HOMEWORK Multiple Choice 7. d Problem 2 Part A Cost of 70% (1400 ÷ 2000) of Star 280,000 Implied value of 100% 400,000 Shareholders' equity Total Preferred Common Preferred stock 50,000 ) 50,000 ) Common stock 200,000 ) 200,000 ) Dr Retained earnings (80,000 ) 8,000 * (88,000 ) Dr 170,000 58,000 ) 112,000 Purchase discrepancy 288,000 Allocated: FV – BV Accounts receivable 2,000 Cr Inventory 7,000 Dr Plant 50,000 Dr Long-term liabilities 20,000 Cr 35,000 Goodwill 253,000 * Dividends in arrears: 500 shares × $8 × 2 years = 8,000 Purchase Discrepancy Amortization Schedule Balance Amortization Balance Jan. 1, YR 5 YR 5 to 11 YR 12 Dec.31,YR 12 Accounts receivable (2,000) (2,000) Inventory 7,000 ) 7,000 ) Plant 50,000 ) 50,000 ) Long-term liabilities (20,000) ) (17,500) ) (2,500) Goodwill 253,000 ) 138,970 ) 19,710 94,320 288,000 ) 176,470 ) 17,210 94,320 Intercompany receivables and payables December management fee 2,000 Intercompany profits Before tax Tax 40% After tax Opening inventory – Star selling 30,000 12,000 18,000
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 4

Chapter 9 Homework - ACCT 4455 Chp 9 Chapter 9: HOMEWORK...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online