Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Company A, Inc. is a distributor of office equipment. Company A has a wholly owned susidiary, JK, a equipment manufacturer. Company A has been talking to company B about forming a new business entity. Company B is also a distributor of office equipment, and has a wholly owned manufacturing subsidary called Nogo. Company A and B have agreed thet they will exchange their entire interest in their wholly owned subsidairies, jk and Nogo. This new corporation would recieve both subsidiaries and issue 50% stock to Company A, and 50% stock to company B. The Fair value of the net assets of each subsidiary exceeds its book value, and the relative net book values and fair values of the two subsidiarse are not proportional. However, through negotiation Company A and B believe their contributions to the newly formed corporation would be equal in value inspite of this disproportional relationship.
The fair value of a 50% interest in the new corporation would exceed the carrying value of Company A's investment in Company B.
1) Discuss how Co. A chould account for the exchnge of its wholly owned subsidiary, JK, for a 50% interest in the newly formed company?
2) Discuss how Co. A should account for its 50% interets in the newly formed corporation subsequent to the exchange?
3) Discuss how the newly formed corporation should account for the assets it recieved in the exchange transaction?
Amalgamation Problem
Determine whether the debt-to-equity ratio is increasing or decreasing and whether the company should be concerned.
preparation of condensed income statement by valuation of inventories with lifo and fifo method.nbspfifo and lifo
Potter Company acquired 90 percent of the voting common shares of Stately Corporation by issuing bonds with a par value and fair value of $121,500 to Strategy’s existing shareholders. Immediately prior to the acquisition, Potter reported total assets..
What kind of system makes sense for your company, given that you plan to start with only one version of your product but at some point in the future may offer a variety of options?
The following trial balance has been extracted from the books of account of Pisa Limited as at 31 December 2015: Required: Prepare Pisa's profit and loss account for the year to 31 December 2015 and a balance sheet as at that date
In reviewing a variance analysis report you note that there was a very favorable materials price variance last month but unfavorable labor and materials efficiency variances. What situation cuuld have caused these variances? What would you do to test..
The fund pays interest at 5% compounded annually. What is the balance of the fund at the end of 2010 (after the 2010 deposit)? Show your work.
At the beginning of the year the following standards were set. Overhead is applied using direct labor hours. What is the labor efficiency variance (LEV)? Favorable/Unfavorable. What is the overhead controllable variance (OCV)? Favorable/Unfavorable
Activity-Based Costing for improved costing accuracy as compared to conventional costing procedures. Explain why activity-based costing is considered to provide more accurate results
Given the following information for Pace Company, derived from the bank reconciliation information for the month of June: Cash Balance per bank statement at June 30 $7,200. Prepare the schedule to reconcile the bank and book balances to the correct b..
The firm has conducted significant market research and estimated the following pattern for sales of the new product - product, and selling and administrative expenses are expected to average $50,000 per year, what is the target cost to produce the n..
illustrate how this new system would work. In this example the allocated base its machine-hours. if the company bases its predetermined overhead rate on capacity, by how much was manufacturing overhead under applied or over applied?
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!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd