13 - SPECIAL APPENDIX CHAPTER 1 EXERCISES EXERCISE SA1-1...

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Unformatted text preview: SPECIAL APPENDIX CHAPTER 1 EXERCISES EXERCISE SA1-1 Value analysis: Price paid..................................................................................... $400,000 Total fair value of net assets........................................................ 528,000 Goodwill....................................................................................... n/a Gain.............................................................................................. 128,000 Journal entry: Currents Assets........................................................................... 120,000 Land (fair value)........................................................................... 80,000 Buildings (net) (fair value)............................................................ 250,000 Equipment (net) (fair value)......................................................... 150,000 Patents (fair value)....................................................................... 20,000 Cash....................................................................................... 400,000 Liabilities (fair value).............................................................. 92,000 Gain on Purchase.................................................................. 128,000 Dr = Cr check amounts................................................................ 620,000 620,000 Acquisition Expense*................................................................... 23,000 Cash....................................................................................... 23,000 *$18,000 direct + $5,000 indirect 61 PROBLEMS PROBLEM SA1-1 Purchase price: Part 1 Part 2 Cash............................................................................................. $385,000 Number of shares exchanged..................................................... 20,000 Par value of a share of stock....................................................... $10 Market value of a share of stock.................................................. $25 Market value of stock exchanged................................................ $500,000 Total purchase price.................................................................... $500,000 $385,000 Value analysis: Price paid..................................................................................... $500,000 $385,000 Fair value of net assets................................................................ 420,000 420,000 Goodwill....................................................................................... 80,000 n/a Gain.............................................................................................. n/a 35,000 Kent Corporation journal entries: (1) Accounts Receivable................................................................... 50,000 Inventory...................................................................................... 250,000 Land.............................................................................................Land....
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This note was uploaded on 12/17/2011 for the course ACC 400 STBSBA73 taught by Professor Gilbertrodriguez during the Spring '09 term at University of Phoenix.

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13 - SPECIAL APPENDIX CHAPTER 1 EXERCISES EXERCISE SA1-1...

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