On May 1, Soriano Co. reported the following account balances along with their estimated fair values:...
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On May 1, Soriano Co. reported the following account balances along with their estimated fair values: Receivables Inventory Copyrights Patented technology Total assets Current liabilities Long-term liabilities Common stock Retained earnings Carrying Amount Fair Value 83,900 $ 83,000 74,688 158,500 800,000 $ 1,199,800 178,000 $ 683,000 100,000 238,888 74,688 586,500 691,000 $1,436,088 178,000 669,700 Total liabilities and equities $ 1,199,888 On that day, Zambrano paid cash to acquire all of the assets and liabilities of Soriano, which will cease to exist as a separate entity. To facilitate the merger, Zambrano also paid $120,000 to an Investment banking firm. The following Information was also available: Zambrano further agreed to pay an extra $81,200 to the former owners of Soriano only if they meet certain revenue goals during the next two years. Zambrano estimated the present value of its probability adjusted expected payment for this contingency at $40,600. Soriano has a research and development project in process with an appraised value of $245,000. However, the project has not yet reached technological feasibility and the project's assets have no alternative future use s&b. Prepare Zambrano's journal entries to record the Soriano acquisition assuming its initial cash payment to the former owners was (a) $767,900 & (b) $888,900. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Journal entry worksheet 1 2 3 Record the acquisition of Soriano Co. Assume its initial cash payment to the former owners was $767,900. Note: Enter debits before credits. Transaction General Journal Debit Credit 1 Hecond entry Clear entry View general journal > Journal entry worksheet 1 2 3 4 Record the expenses related to the combination. Assume its initial cash payment to the former owners was $767,900. Note: Enter debits before credits. Transaction 2 General Journal Debit Credit Record entry Clear entry View general journal Journal entry worksheet < 1 2 Record the acquisition of Soriano Co. Assume its initial cash payment to the former owners was $888,900. Note: Enter debits before credits Transaction 3 General Journal Debit Credit Mecondary Clear entry > Journal entry worksheet <123 Record the expenses related to the combination. Assume its initial cash payment to the former owners was $888,900. Note: Enter debits before credits. Transaction General Journal Debit Credit Record entry Clear entry View general journal On May 1, Soriano Co. reported the following account balances along with their estimated fair values: Receivables Inventory Copyrights Patented technology Total assets Current liabilities Long-term liabilities Common stock Retained earnings Carrying Amount Fair Value 83,900 $ 83,000 74,688 158,500 800,000 $ 1,199,800 178,000 $ 683,000 100,000 238,888 74,688 586,500 691,000 $1,436,088 178,000 669,700 Total liabilities and equities $ 1,199,888 On that day, Zambrano paid cash to acquire all of the assets and liabilities of Soriano, which will cease to exist as a separate entity. To facilitate the merger, Zambrano also paid $120,000 to an Investment banking firm. The following Information was also available: Zambrano further agreed to pay an extra $81,200 to the former owners of Soriano only if they meet certain revenue goals during the next two years. Zambrano estimated the present value of its probability adjusted expected payment for this contingency at $40,600. Soriano has a research and development project in process with an appraised value of $245,000. However, the project has not yet reached technological feasibility and the project's assets have no alternative future use s&b. Prepare Zambrano's journal entries to record the Soriano acquisition assuming its initial cash payment to the former owners was (a) $767,900 & (b) $888,900. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Journal entry worksheet 1 2 3 Record the acquisition of Soriano Co. Assume its initial cash payment to the former owners was $767,900. Note: Enter debits before credits. Transaction General Journal Debit Credit 1 Hecond entry Clear entry View general journal > Journal entry worksheet 1 2 3 4 Record the expenses related to the combination. Assume its initial cash payment to the former owners was $767,900. Note: Enter debits before credits. Transaction 2 General Journal Debit Credit Record entry Clear entry View general journal Journal entry worksheet < 1 2 Record the acquisition of Soriano Co. Assume its initial cash payment to the former owners was $888,900. Note: Enter debits before credits Transaction 3 General Journal Debit Credit Mecondary Clear entry > Journal entry worksheet <123 Record the expenses related to the combination. Assume its initial cash payment to the former owners was $888,900. Note: Enter debits before credits. Transaction General Journal Debit Credit Record entry Clear entry View general journal
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Related Book For
Fundamentals of Advanced Accounting
ISBN: 978-0077862237
6th edition
Authors: Joe Ben Hoyle, Thomas Schaefer, Timothy Doupnik
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