Question: On September 30, Fleming Stores, Inc. announced it is acquiring 100% of the net assets of Fisherman Gear Company through a stock acquisition in which
On September 30, Fleming Stores, Inc. announced it is acquiring 100% of the net assets of Fisherman Gear Company through a stock acquisition in which Fleming will issue 2 million shares ($5 par value) of stock. Assuming the transaction is closed on December 31 year-end and that the market price of Fleming's stock was $50 and $55 on September 30 and December 31, respectively, what is the journal entry recorded by Fleming at year-end if the acquisition method is used? Credit (Cr) Debit (Dr) Investment in Subsidiary $110,000,000 Common stock $10,000,000 A.P.I.C. 100,000,000 o Debit (Dr) Credit (Cr) Investment in Subsidiary $100,000,000 Cash $100,000,000
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