Solution-What should be the basis for reporting the assets

What should be the basis for reporting the assets

Assignment Help Accounting Basics

Reference no: EM132510569

Question - On January 1, Year One, Big Company acquires 100 percent of the outstanding shares of Small Company by issuing its own stock worth $12 million. The shares of Small had been worth only $11 million in the period leading up to the acquisition but Big had to pay a premium in order to obtain all of the stock. Big paid an additional $200,000 in cash to attorneys as direct consolidation costs and another $150,000 in stock issuance costs. According to US GAAP, what should be the basis for reporting the assets and liabilities of Small within consolidated financial statements created on the date of acquisition?

A. $11,350,000

B. $12,000,000

C. $12,200,000

D. $12,350,000

Reference no: EM132510569

Questions Cloud

Why wealthy nations and developing nations : Explains why wealthy nations and developing nations should work together to improve cybersecurity for globally connected networks referred to as the Internet

Explain five key internal controls : Explain five key internal controls that should be implemented in the Expenditure Cycle of any large corporation

Discussion of measuring system accuracy and its impact : Understanding the importance of a purchase order for the manufacture of a particular product and Comprehend the significance of quality standards and theories

Find income under variable costing is : Production was 40 units per year in 2018-2020. Sales were 40 units in 2018, 36 units in 2019, and 44 units in 2020. Income under variable costing for 2019 is

What should be the basis for reporting the assets : What should be the basis for reporting the assets and liabilities of Small within consolidated financial statements created on the date of acquisition

Find income under absorption costing is : 20 units per year in 2018-2020. Sales were 20 units in 2018, 16 units in 2019, and 24 units in 2020. Income under absorption costing for 2020 is

What would be the maximum transfer price per unit : If the internal transfer is made, Division A will not incur any selling costs. What maximum transfer price per unit that Division B would be willing to accept?

Prepare the journal entry to record issuance of the note : On January 1, MM Co. borrows $340,000 cash from a bank and in return signs an 8% installment note, Prepare the journal entry to record issuance of the note

Business intelligence : KONE is a global industry company (based in Finland) that manufactures mostly elevators and escalators and also service over 1.1million elevators,

User Account

All Pages

What should be the basis for reporting the assets

Reference no: EM132510569

Reference no: EM132510569

Questions Cloud

Reviews

Write a Review

Accounting Basics Questions & Answers

How much control does fed have over this longer real rate

Coures:- fundamental accounting principles

Accounting problems

Theory of interest - term structure of interest rates

Write a report on internal controls

Prepare the bank reconciliation for company

Cost-benefit analysis

Theory of interest

Liquidity and profitability

What is the expected risk premium on the portfolio

Simple interest and compound interest

Capm and venture capital

Assured A++ Grade

Academics

Major Subjects

Majors

Get In Touch

TERMS & POLICIES

HELP & SUPPORT