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ch4 - ch4 1 For business combinations involving less than...

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ch4 1. For business combinations involving less than 100 percent ownership, the acquirer recognizes and measures all of the following at the acquisition date except : A. identifiable assets acquired, at fair value. B. liabilities assumed, at book value. C. noncontrolling interest, at fair value. D. goodwill or a gain from bargain purchase. E. none of these choices is correct. When Jolt Co. acquired 75% of the common stock of Yelts Corp., Yelts owned land with a book value of $70,000 and a fair value of $100,000. 2. What amount should have been reported for the land in a consolidated balance sheet at the acquisition date? 3. What is the total amount of excess land allocation at the acquisition date? 4. What is the amount of excess land allocation attributed to the controlling interest at the acquisition date? 5. What is the amount of excess land allocation attributed to the noncontrolling interest at the acquisition date? A. $0. B. $30,000. C. $22,500. D. $7,500. E. $17,500.
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6. What amount should have been reported for the land in a consolidated balance sheet, assuming the investment was obtained prior to January 1, 2009 and the purchase method of accounting for business combinations was used? Perch Co. acquired 80% of the common stock of Float Corp. for $1,600,000. The fair value of Float's net assets was $1,850,000, and the book value was $1,500,000. The noncontrolling interest shares of Float Corp. are not actively traded. 7. What is the total amount of goodwill recognized at the date of acquisition? 8. What amount of goodwill should be attributed to Perch at the date of acquisition? 9. What amount of goodwill should be attributed to the noncontrolling interest at the date of acquisition? A. $0. B. $20,000. C. $30,000. D. $100,000. E. $120,000. 10. What is the dollar amount of noncontrolling interest that should appear in a consolidated balance sheet prepared at the date of acquisition?
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11. What is the dollar amount of Float Corp.'s net assets that would be represented in a consolidated balance sheet prepared at the date of acquisition? 12. What is the dollar amount of fair value over book value differences attributed to Perch at the date of acquisition? Femur Co. acquired 70% of the voting common stock of Harbor Corp. on January 1, 2010. During 2010, Harbor had revenues of $2,500,000 and expenses of $2,000,000. The amortization of excess cost allocations totaled $60,000 in 2010.
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