Blatant Advertising Corporation acquired 60 percent of Quinn Manufacturing Company's shares on December 31, 20X1, at underlying
Question:
Blatant Advertising Corporation acquired 60 percent of Quinn Manufacturing Company's shares on December 31, 20X1, at underlying book value of $180,000. At that date, the fair value of the noncontrolling interest was equal to 40 percent of the book value of Quinn Manufacturing. Quinn's balance sheet on January 1, 20X7, contained the following balances:
On January 1, 20X7, Quinn purchased 2,000 of its own $10 par value common shares from Nonaffiliated Corporation for $42 per share.
Required
a. Compute the change in the book value of the equity attributable to the parent as a result of the repurchase of shares by Quinn Manufacturing.
b. Give the entry to be recorded on Blatant Advertising's books to recognize the change in the book value of the shares it holds.
c. Give the elimination entry needed in preparing a consolidated balance sheet immediately following the purchase of shares byQuinn.
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial... Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may... Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...
Step by Step Answer:
Advanced Financial Accounting
ISBN: 978-0078025624
10th edition
Authors: Theodore E. Christensen, David M. Cottrell, Richard E. Baker