On January 1, 2014, Perry Company purchased 8,000 shares of Soho Company's common stock for $120,000. Immediately

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On January 1, 2014, Perry Company purchased 8,000 shares of Soho Company's common stock for $120,000. Immediately after the stock acquisition, the statements of financial position of Perry and Soho appeared as follows:

On January 1, 2014, Perry Company purchased 8,000 shares of
On January 1, 2014, Perry Company purchased 8,000 shares of

Required:
A. Calculate the percentage of Soho acquired by Perry Company. Prepare a schedule to compute the difference between book value of equity and the value implied by the purchase price. Any difference between the book value of equity and the value implied by the purchase price relates to subsidiary plant assets?
B. Prepare a consolidated balance sheet work-paper as of January 1, 2014?
C. Suppose instead that Perry acquired the 8,000 shares for $20 per share including a $5 per share control premium. Prepare a computation and allocation of difference schedule?

Balance Sheet
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...
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Advanced Accounting

ISBN: 978-1119119364

6th edition

Authors: Debra Jeter, Paul Chaney

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