User Account

All Pages

What values for each of the acquired assets and liabilities

Assignment Help Accounting Basics
Reference no: EM132521564

Question - Pear Company acquired all of Strawberry, Inc.'s outstanding shares on January 1. Pear paid $300,000 and issued $200,000 in long-term liabilities and paid $35,000 in legal fees.

Pear also agreed to pay $75,000 to the former owners of Strawberry contingent on meeting certain revenue goals during the following year. Pear estimated the present value of its probability adjusted expected payment for the contingency or contingent obligation at $23,000.

Pre combination book values for Strawberry are as follows:

Current assets $85,000

Equipment 90,000

Buildings 175,000

Goodwill 30,000

Total $380,000

Current liabilities $(50,000)

Common stock (180,000)

Retained earnings (115,000)

Revenues (135,000)

Expenses 100,000

Total $ 380,000

Pear's appraisal of Strawberry found two balance sheet accounts that differed from fair value. Equipment was undervalued by $15,000 and Buildings by $5,000. Pear noted that Strawberry has unrecorded client contracts worth $60,000 and research and development activity in process with an appraised fair value of $90,000. The total consideration is 523000.

Required - What values for each of the acquired assets and liabilities will be used in the consolidation?

Reference no: EM132521564

Questions Cloud

Pass a cross-section of the wire in the time interval : How many coulombs pass a cross-section of the wire in the time interval t = 5 secs. and t =10 secs.
Compares to the acceleration of the smaller one : How do you expect the free fall acceleration of the larger ball compares to the acceleration of the smaller one
Report on one important contemporary supply chain management : Report on one important contemporary supply chain management topic that you think is of contemporary relevance or will have a major impact in the future
What the annual financial advantage for the company : What The annual financial advantage (disadvantage) for the company as a result of buying part U16 from the outside supplier should be
What values for each of the acquired assets and liabilities : Pear's appraisal of Strawberry found two balance sheet accounts that differed from fair value. What values for each of the acquired assets and liabilities
Estimate the behaviour of shipping expenses : Which two months should be used if Phillips wants to estimate the behaviour of shipping expenses using the high-low method?
Discussion - pricing strategy : Discussion - Pricing Strategy. What are other factors the owner should consider to make sure next year's financial statements report net income
Legal rights afforded to the accused : What procedural steps must the officers perform following John's arrest and interview at the police station?
Calculate the free fall acceleration : A ball is dropped from a height of 2.68 m and takes 0.73986 s to reach the floor. Calculate the free fall acceleration.

Reviews

Write a Review

Accounting Basics Questions & Answers

  What is the internal rate of return

Keita Knightly Company buys a piece of equipment for $36,442 that will last for 7 years. What is the internal rate of return

  Calculate the payback periods

Calculate the payback periods. Which project will you choose if you apply the Payback Period rule? Calculate the Profitability Indexes. Which project will you choose if you apply the Profitability Index rule? What is you final decision? Explain.

  The companys cost analyst has concluded that utilities cost

the hard rock mining company is developing cost formulas for management planning and decision-making purposes. the

  How the business can be viable or profitable

For each sheet, the cell colored in yellow are decision variable cells. Within these cells, users of your excel data model will be able to change the values.

  Do the tools help only in certain situations such as

how would you reply to your coworker? consider the following items in your discussion1.do the tools help only in

  What is the cost of goods sold per unit

Costanzo Company manufactures a specialty line of silk-screened blouses. If Job 1041 consisted of 5,000 blouses (or units), what is the cost of goods sold

  Prepare the journal entries to record the transactions

Prepare the journal entries to record the following transactions in Hunt Ltd's records using a perpetual inventory system

  Gordon company produces two types of gears gear q and gear

gordon company produces two types of gears gear q and gear s with unit contribution margins of 2 and 5 respectively.

  Record entries for items on bank reconciliation statement

A service charge of $22 appears on the bank statement. Record entries for any items on the bank reconciliation statement that must be journalized

  Fundamental drivers of the fraud

Research one (1) publicly traded company that committed fraud within the last five (5) years and the fundamental drivers of the fraud.

  Applying overhead to production

In a labor intensive company in which more overhead is used by the more highly skilled and paid employees, which activity base would be most appropriate for applying overhead to production?

  Rogers and hornsby are two companies that compete in the

rogers and hornsby are two companies that compete in the same market with the same product a brand of steak sauce. the

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

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