Present Corporation established Surprise Company as a wholly owned subsidiary. Present reported the following balance sheet...

  

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Present Corporation established Surprise Company as a wholly owned subsidiary. Present reported the following balance sheet accounts immediately before and after it transferred assets and accounts payable to Surprise Company in exchange for 4,000 shares of $15 par value common stock having a FMV of $20. Account Cash Accounts Receivable Allowance for Doubtful Accounts. Inventory Investment in Scissor Co. Land Depreciable Assets Accumulated Depreciation Accounts Payable Bonds Payable Common Stock Retained Earnings Amount Reported Before Transfer After Transfer $60,000 95,000 10,000 50,000 35,000 200,000 95,000 60,000 100,000 100,000 75,000 $40,000 56,000 8,000 36,000 ? 27,000 130,000 62,000 $33,000 100,000 100,000 75,000 A AL 33 Ap23 Required Questions 8900 1. What was Present's book value of the total assets transferred to Surprise? 116000 What amount should Present report as its investment in Surprise after the transfer? What was the amount of change (increase or decrease) in total assets of Present due to the transfer of 19000 = 2700 dear-se assets and accounts payable? 11/000 What change did the transfer of assets and accounts payable have on the amount of shares outstanding No chanse in the consolidated balance sheet? 2. 3. - 5. What amount did Surprise record as additional paid-in capital upon issuance of the common stock? 2 Does internal expansion constitute a business combination? (Use Y for Yes and for No) Present Corporation established Surprise Company as a wholly owned subsidiary. Present reported the following balance sheet accounts immediately before and after it transferred assets and accounts payable to Surprise Company in exchange for 4,000 shares of $15 par value common stock having a FMV of $20. Account Cash Accounts Receivable Allowance for Doubtful Accounts. Inventory Investment in Scissor Co. Land Depreciable Assets Accumulated Depreciation Accounts Payable Bonds Payable Common Stock Retained Earnings Amount Reported Before Transfer After Transfer $60,000 95,000 10,000 50,000 35,000 200,000 95,000 60,000 100,000 100,000 75,000 $40,000 56,000 8,000 36,000 ? 27,000 130,000 62,000 $33,000 100,000 100,000 75,000 A AL 33 Ap23 Required Questions 8900 1. What was Present's book value of the total assets transferred to Surprise? 116000 What amount should Present report as its investment in Surprise after the transfer? What was the amount of change (increase or decrease) in total assets of Present due to the transfer of 19000 = 2700 dear-se assets and accounts payable? 11/000 What change did the transfer of assets and accounts payable have on the amount of shares outstanding No chanse in the consolidated balance sheet? 2. 3. - 5. What amount did Surprise record as additional paid-in capital upon issuance of the common stock? 2 Does internal expansion constitute a business combination? (Use Y for Yes and for No)

Answer rating: 100% (QA)

The image youve provided shows a portion of a balance sheet with account balances before and after a transfer and there are questions pertaining to those balances To answer the questions well review t... View the full answer