e. On January 1, 2017, P acquired 80% of S for $400,000. On the date of acquisition,

  e.  

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On January 1, 2017, P acquired 80% of S for $400,000. On the date of acquisition, S had the following balance sheet: S Company Balance Sheet January 1, 2017 Assets Liabilities and Stockholders' Equity Cash $50,000 Accounts Payable $100,000 Accounts Receivable 50,000 Bonds Payable $200,000 Inventory 20,000 Common Stock $1 par 80,000 Land 140,000 Paid in Capital 20,000 Buildings 160,000 Retained Earnings 50,000 Acc. Dep'n-Bldg (100,000) Equipment 150,000 Acc. Dep'n-Equip (50,000) Goodwill 30,000 $450,000 Total $450,000 Total On the date of acquisition, the fair market values of the following net assets differed from their book values: Item Inventory Land Buildings Equipment Bonds Payable Fair Market Value $30,000 Additional Information Sold at the end of 2017 200,000 190,000 80,000 20-year remaining life 10-year remaining life 190,000 5-year remaining life Any remaining excess is attributable to goodwill. On January 1, 2017, P acquired 80% of S for $400,000. On the date of acquisition, S had the following balance sheet: S Company Balance Sheet January 1, 2017 Assets Liabilities and Stockholders' Equity Cash $50,000 Accounts Payable $100,000 Accounts Receivable 50,000 Bonds Payable $200,000 Inventory 20,000 Common Stock $1 par 80,000 Land 140,000 Paid in Capital 20,000 Buildings 160,000 Retained Earnings 50,000 Acc. Dep'n-Bldg (100,000) Equipment 150,000 Acc. Dep'n-Equip (50,000) Goodwill 30,000 $450,000 Total $450,000 Total On the date of acquisition, the fair market values of the following net assets differed from their book values: Item Inventory Land Buildings Equipment Bonds Payable Fair Market Value $30,000 Additional Information Sold at the end of 2017 200,000 190,000 80,000 20-year remaining life 10-year remaining life 190,000 5-year remaining life Any remaining excess is attributable to goodwill.

Answer rating: 100% (QA)

1 Value Analysis Schedule Item Fair Market Value Book Value Excess FMV Book Value Inventory 30000 20000 10000 Land 190000 150000 40000 Buildings 19000... View the full answer