Week 2 - Given Data P02-15: Spider, Inc. outstanding stock...

Info iconThis preview shows pages 1–5. Sign up to view the full content.

View Full Document Right Arrow Icon
Given Data P02-15: Spider, Inc. outstanding stock 100% acquired by Pratt Company Use this template Cash paid by Pratt for acquisition $495,000 Assessment of Spider's fair and book value differences: Step 1: Complete pur Step 2: Complete Jou Book Fair Step 3: Input journal Values Values Computer software $20,000 $70,000 Equipment 40,000 30,000 Client contracts - 100,000 In-process research and development - 40,000 Notes payable (60,000) (65,000) December 31, 2009 Financial Information Pratt Spider Cash $36,000 $18,000 Receivables 116,000 52,000 Inventory 140,000 90,000 Investment in Spider 495,000 - Computer software 210,000 20,000 Buildings (net) 595,000 130,000 Equipment (net) 308,000 40,000 Client contracts - - Goodwill - - Total assets $1,900,000 $350,000 Accounts payable $(88,000) $(25,000) Notes payable (510,000) (60,000) Common stock (380,000) (100,000) Additional paid-in capital (170,000) (25,000) Retained earnings (752,000) (140,000) Total liabilities and equities $(1,900,000) $(350,000)
Background image of page 1

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

View Full DocumentRight Arrow Icon
to complete the Problem 2-15 based upon the 3 step approach below: rchase price allocation on Tab 2-15 urnal Entries on Tab 2-15 Journal Entries l entries into Tab 2-15 consolidation worksheet
Background image of page 2
Journal Entries to Record Consolidation "S" Entry DR CR Common Stock 100,000 APIC 25,000 Retained Earnings 140,000 Investment in Subsidiary 265,000 265,000 265,000 Elimination of the subsidiary's stockholder's equity accounts. "A" Entry Computer Software 50,000 Client Contracts 100,000 40,000 Goodwill 55,000 Equipment 10,000 Notes Payable 5,000 Investment in Subsidiary 230,000 245,000 245,000 Allocation of consideration fair value
Background image of page 3

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

View Full DocumentRight Arrow Icon
Student Name: Student Class: AC559 Problem 02-15 - Purchase price and account allocation Consideration transferred at fair value $495,000 Book value 265,000 Excess fair over book value 230,000 Correct! Allocation of excess fair value to
Background image of page 4
Image of page 5
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 01/13/2011 for the course ACCT AC555 taught by Professor George during the Spring '10 term at DeVry Chicago.

Page1 / 12

Week 2 - Given Data P02-15: Spider, Inc. outstanding stock...

This preview shows document pages 1 - 5. Sign up to view the full document.

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