Prepare a schedule to allocate the fair value

Assignment Help Accounting Basics
Reference no: EM133154834

Question - Abc Corporation paid $300,000 for 90% of the outstanding voting common stock of SIM Corporation on January 2, 2011 when the book value of SIM net assets was $200,000. The fair values of SALEM identifiable net assets were equal to their book values except as indicated below.

 

Book Value

Fair Value

Inventories (sold in 2011)

$120,000

$140,000

Buildings-net (10-year life)

250,000

300,000

Equipment (5-year life)

150,000

140,000

Account payable (in 2011)

40,000

20,000

SALEM reported net income of $60,000 during 2011; dividends of $40,000 were declared and paid during the year.

Required -

1. Prepare a schedule to allocate the fair value/book value differential to the specific identifiable assets and liabilities.

2. Determine ABC income from SIM for 2011.

3. Determine the correct balance in the Investment in SIM account as of December 31, 2011.

Reference no: EM133154834

Questions Cloud

How much should be recorded in lindio capital account : The land was sold for P50,000 on July 1, three hours after the formation of the partnership. How much should be recorded in Lindio's capital account
Evaluation of service provision : In the evaluation of service provision consider and respond to the following:
How is identity theft a problem in today world : How is identity theft a problem in today's world? And what can the canadian government do to tighten this up/fix this issue?
How much time is needed for tapping the trees : 1. In the late winter every year, many New England farmers make maple syrup. They tap maple trees for their sap, which is then boiled down to make maple syrup.
Prepare a schedule to allocate the fair value : Prepare a schedule to allocate the fair value/book value differential to the specific identifiable assets and liabilities
Advantageous to exercise before expiration : Suppose that you are dealing with a American call on currency, and that the foreign currency has risk-free rate 0. Explain why, in this case, the American call
Estimate pose an ethical dilemma for craig : Does revising the warranty expense estimate pose an ethical dilemma for Craig? Please explain your response.
Describe how temperature is involved in each stage : Explanation of the minimum number of components per year that you believe would make the business viable. This should factor in not only the production costs
Ethics and social justice in criminal justice system : Explain how technology, such as cell phones and social media, has impacted the issues of ethics and social justice in the criminal justice system.

Reviews

Write a Review

Accounting Basics Questions & Answers

  Basic and diluted earnings per share

Compute Brisbane's basic and diluted earnings per share for 2006.

  Compute the earnings per share of revival corporation

Based on the information provided above, compute the earnings per share of Revival Corporation as of March 31, 2017?

  Describe a merchandiser cost of goods sold

Identify which items are subtracted from the list amount and not recorded when computing purchase price: (a) freight-in; (b) trade discount.

  Prepare the journal entries on december 28 and january 6

VTC paid the net-of-discount amount on January 6, 2012. Prepare the journal entries on December 28 and January 6 to record the purchase and payment.

  Prepare a cash budget for september and october

Prepare a cash budget for September, October, November, and December. What are the budget implications for Priscilla Wescott

  What is the net present value of the project

LakeCraft is considering investing in a cruise ship with an expected life of 10 years that costs $110 million. What is the net present value of the project

  Dobbs corporation is considering purchasing a new delivery

dobbs corporation is considering purchasing a new delivery truck. the truck has many advantages over the companys

  Estimate the firms net after-tax cash flows

The firm's marginal tax rate is 40%. Estimate the firm's net after-tax cash flows, if the CCA rate for the robots is 30%. Find the PE value with MARR = 15%.

  What is the pre-money valuation for the series d

You invested $100,000 of your money and received 5 million shares of Series A preferred stock. What is the pre-money valuation for the Series D funding round

  If a 6000 10 percent 10 year bond was issued at 104 on

if a 6000 10 percent 10 year bond was issued at 104 on october 1 2011 how much interest will accrue on december 31 if

  Professional service organizations

Identify the top-three issues that should be discussed when considering contracting the services of a payroll service provider. Evaluate the impact, both positive and negative, of each issue on the process in question. Provide specific examples to..

  Find which is the variable overhead spending variance

During the year, Factory A actually produced 10,000 units, used 20,000 direct labour hours. Which one is the variable overhead spending variance?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd