A new CEO was hired to revive the floundering Champion Chemical Corporation. The company had endured operating

Question:

A new CEO was hired to revive the floundering Champion Chemical The company had endured operating losses for several years, but confidence was emerging that better times were ahead. The board of directors and shareholders approved a quasi reorganization for the The reorganization included devaluing inventory for obsolescence by $105 million and increasing land by $5 million. Immediately prior to the restatement, at December 31, 2018, Champion Chemical Corporation's appeared as follows (in condensed form):
CHAMPION CHEMICAL Sheet
At December 31, 2018
($ in millions)
Cash .......................................................................................$ 20
Receivables .................................................................................40
Inventory ..................................................................................230
Land .........................................................................................40
Buildings and equipment (net) ...........................................................90
.............................................................................................$ 420
Liabilities ................................................................................$ 240
Common stock (320 million shares at $1 par) ........................................320
Additional paid-in capital .................................................................60
Retained earnings (deficit) .............................................................(200)
.............................................................................................$ 420
Required:
1. Prepare the journal entries appropriate to record the quasi reorganization on January 1, 2019.
2. Prepare a as it would appear immediately after the restatement.
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... 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...