Green acquired 100% of Vega on January 1, 2009, by issuing 10,500 shares of its $10 par
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Question:
Green acquired 100% of Vega on January 1, 2009, by issuing 10,500 shares of its $10 par value common stock with a fair value of $95 per share. On January 1, 2009, Vega's land was undervalued by $40,000, its buildings were overvalued by $30,000, and equipment was undervalued by $80,000. The buildings have a 20-year life and the equipment has a 10-year life. $50,000 was attributed to an unrecorded trademark with a 16-year remaining life. There was no goodwill associated with this investment.
Compute the book value of Vega at January 1, 2009.
A. | $997,500. |
B. | $857,500. |
C. | $1,200,000. |
D. | $1,600,000. |
E. | $827,500. |
Related Book For
Intermediate Accounting
ISBN: 978-0324659139
11th edition
Authors: Loren A. Nikolai, John D. Bazley, Jefferson P. Jones
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