Brightcove, Inc. acquires all of the stock of Ciber, Inc. for $112.5 million in cash and...

 

 

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Brightcove, Inc. acquires all of the stock of Ciber, Inc. for $112.5 million in cash and accounts for the acquisition as a stock acquisition. Balance sheet information at the date of acquisition is as follows (in thousands): Brightcove, Inc. Ciber, Inc. Book Value Book Value Fair Value Dr (Cr) Dr (Cr) Dr (Cr) Current assets $157,500 $900 $675 Plant and equipment, net 450,000 27,000 9,000 Licenses and trademarks 11,250 15,750 Investment in Ciber 112,500 Current liabilities (180,000) (1,800) (1,800) Long-term liabilities (337,500) (22,500) (24,750) Capital stock (78,750) (18,000) Retained earnings (123,750) 3,150 Total $0 $0 Brightcove hires a consultant to identify and value any previously unreported intangible assets attributable to Ciber at the date of acquisition. The consultant identifies the following intangibles: Fair Value (in thousands) Customer contracts $2,250 Assembled workforce 45,000 Brand names 11,250 Leases at rents below current market 900 Brand names 11,250 Leases at rents below current market 900 Developed technology 3,375 In-process research and development 675 Future cost savings from elimination of duplicate assets 1,800 Additional expected revenues from bundling products 1,350 a. Prepare a schedule of the excess of acquisition cost over Ciber's book value and its allocation to Ciber's identifiable net assets and goodwill. (all amounts in thousands) • When appropriate, use negative signs with your excess of fair value over book value answers (left column only). • Do not use negative signs in the right column. • Enter answers in thousands. Acquisition cost Ciber book value Excess of acquisition cost over book value Excess of fair value over book value: Current assets Plant and equipment, net Licenses and trademarks Long term liabilities Customer contracts Brand names o o o o Goodwill b. Prepare a working paper to consolidate the balance sheet accounts of Brightcove and Ciber at the date of acquisition. (all amounts in thousands) Use negative signs with your credit balance answers in the Consolidated Balances column. Consolidation Working Paper Accounts Taken From Books Eliminations Ciber Brightcove Dr (Cr) Consolidated Balances (in thousands) Dr (Cr) Debit Credit Dr (Cr) Current assets $ 157,500 $900 O (R) $ Plant and equipment net 450,000 27,000 O (R) Licenses and trademarks 11,250 (R) Investment in Ciber 112,500 O (E) O (R) Customer contracts - (R) Brand names (R) (R) -- (R) - (R) Goodwill (R) Current liabilities (180,000) (1,800) Long-term liabilities (337,500) (22,500) O (R) Capital stock (78,750) (18,000) (E) Retained earnings (123,750) 3,150 O (E) Total $0 $0 c. Prepare the consolidated balance sheet at the date of acquisition, in good form. (all amounts in thousands) Brightcove, Inc. and Subsidiary Consolidated Balance Sheet Date of Acquisition Assets Liabilities Current assets O Current liabilities 2$ O Long-term liabilities O Total liabilities Plant and equipment, net Licenses and trademarks Other identifiable intangible assets Goodwill O Stockholders equity Capital stock o o o o o o Retained earnings Total equity Total assets 0 Total liabilities and equity $ Brightcove, Inc. acquires all of the stock of Ciber, Inc. for $112.5 million in cash and accounts for the acquisition as a stock acquisition. Balance sheet information at the date of acquisition is as follows (in thousands): Brightcove, Inc. Ciber, Inc. Book Value Book Value Fair Value Dr (Cr) Dr (Cr) Dr (Cr) Current assets $157,500 $900 $675 Plant and equipment, net 450,000 27,000 9,000 Licenses and trademarks 11,250 15,750 Investment in Ciber 112,500 Current liabilities (180,000) (1,800) (1,800) Long-term liabilities (337,500) (22,500) (24,750) Capital stock (78,750) (18,000) Retained earnings (123,750) 3,150 Total $0 $0 Brightcove hires a consultant to identify and value any previously unreported intangible assets attributable to Ciber at the date of acquisition. The consultant identifies the following intangibles: Fair Value (in thousands) Customer contracts $2,250 Assembled workforce 45,000 Brand names 11,250 Leases at rents below current market 900 Brand names 11,250 Leases at rents below current market 900 Developed technology 3,375 In-process research and development 675 Future cost savings from elimination of duplicate assets 1,800 Additional expected revenues from bundling products 1,350 a. Prepare a schedule of the excess of acquisition cost over Ciber's book value and its allocation to Ciber's identifiable net assets and goodwill. (all amounts in thousands) • When appropriate, use negative signs with your excess of fair value over book value answers (left column only). • Do not use negative signs in the right column. • Enter answers in thousands. Acquisition cost Ciber book value Excess of acquisition cost over book value Excess of fair value over book value: Current assets Plant and equipment, net Licenses and trademarks Long term liabilities Customer contracts Brand names o o o o Goodwill b. Prepare a working paper to consolidate the balance sheet accounts of Brightcove and Ciber at the date of acquisition. (all amounts in thousands) Use negative signs with your credit balance answers in the Consolidated Balances column. Consolidation Working Paper Accounts Taken From Books Eliminations Ciber Brightcove Dr (Cr) Consolidated Balances (in thousands) Dr (Cr) Debit Credit Dr (Cr) Current assets $ 157,500 $900 O (R) $ Plant and equipment net 450,000 27,000 O (R) Licenses and trademarks 11,250 (R) Investment in Ciber 112,500 O (E) O (R) Customer contracts - (R) Brand names (R) (R) -- (R) - (R) Goodwill (R) Current liabilities (180,000) (1,800) Long-term liabilities (337,500) (22,500) O (R) Capital stock (78,750) (18,000) (E) Retained earnings (123,750) 3,150 O (E) Total $0 $0 c. Prepare the consolidated balance sheet at the date of acquisition, in good form. (all amounts in thousands) Brightcove, Inc. and Subsidiary Consolidated Balance Sheet Date of Acquisition Assets Liabilities Current assets O Current liabilities 2$ O Long-term liabilities O Total liabilities Plant and equipment, net Licenses and trademarks Other identifiable intangible assets Goodwill O Stockholders equity Capital stock o o o o o o Retained earnings Total equity Total assets 0 Total liabilities and equity $

Answer rating: 100% (QA)

A Acquisition cost 112500 Ciber book value 14850 Excess ... View the full answer