Question

On December 31, 2011, PanTech Company invests $20,000 in SoftPlus, a variable interest entity. In contractual agreements completed on that date, PanTech established itself as the primary beneficiary of SoftPlus. Previously, PanTech had no interest in SoftPlus. Immediately after PanTech’s investment, SoftPlus presents the following balance sheet


Each of the above amounts represents an assessed fair market value at December 31, 2011, except for the marketing software.
a. If the marketing software was undervalued by $20,000, what amounts for SoftPlus would appear in PanTech’s December 31, 2011, consolidated financial statements?
b. If the marketing software was overvalued by $20,000, what amounts for SoftPlus would appear in PanTech’s December 31, 2011, consolidated financialstatements?


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  • CreatedOctober 04, 2014
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