Problem 2-4 (LO 6, 7, 10) 100% purchase, goodwill, push-down accounting. On March 1, 20X5, Collier Enterprises purchased a 100% interest in Robby Corporation for $480,000.

It was decided that Robby Corporation will apply push-down accounting principles to account for this acquisition.

Robby Corporation had the following balance sheet on February 28, 20X5:

Collier Enterprises received an independent appraisal on the fair values of Robby Corporation’s assets. The controller has reviewed the following figures and accepts them as reasonable.
Inventory . . . . . . . . . . . . . . . . . . . . . . . . . . $100,000 Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55,000 Building . . . . . . . . . . . . . . . . . . . . . . . . . . . 200,000 Equipment . . . . . . . . . . . . . . . . . . . . . . . . . . 150,000 Bonds payable . . . . . . . . . . . . . . . . . . . . . . . 98,000 1. Record the investment in Robby Corporation.
2. Prepare a zone analysis and a determination and distribution of excess schedule.
3. Give Robby Corporation’s adjusting entry.