The balance sheets of Pittsburg Company and Atlanta Company as of January 1, 2020, are shown...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
The balance sheets of Pittsburg Company and Atlanta Company as of January 1, 2020, are shown below. On that date Pittsburg purchased the net assets of Atlanta. Pittsburg Company issued 25,000 shares of their common stock for the net assets of Atlanta Company. The market value of Pittsburg's shares was $48 per share, the par value is $16 per share. The fair values of Atlanta Company's assets and liabilities are equal to their book values with the exception of buildings and equipment, which has an estimated fair value of $720,000. Cash Pittsburg $520,000 Atlanta $ 200,000 Accounts receivable 320,000 240,000 Inventory 1,975,000 Buildings and equipment, net 3,275,000 Total assets $6,090,000 Liabilities $1,935,000 Common stock 3,557,000 240,000 800,000 $1,480,000 $ 320,000 800,000 APIC Retained earnings Total liabilities and equity 300,000 298,000 $6,090,000 $1,480,000 360,000 Required: a. Prepare the journal entry on Pittsburg's books to record the acquisition of the net assets of Atlanta. b. Prepare a balance sheet for Pittsburg immediately after the acquisition of the net assets. C. Prepare the journal entry on Atlanta's books to record the sale of the net assets to Pittsburg. d. Prepare a balance sheet for Atlanta immediately after the sale of their net assets. e. f. Prepare the journal entry on Pittsburg's books to record the acquisition assuming Pittsburg purchased 100% of Atlanta's stock for the 25,000 shares of Pittsburg's stock. If Pittsburg purchased 100% of Atlanta's stock in the acquisition, what journal entry would be made by Atlanta? The balance sheets of Pittsburg Company and Atlanta Company as of January 1, 2020, are shown below. On that date Pittsburg purchased the net assets of Atlanta. Pittsburg Company issued 25,000 shares of their common stock for the net assets of Atlanta Company. The market value of Pittsburg's shares was $48 per share, the par value is $16 per share. The fair values of Atlanta Company's assets and liabilities are equal to their book values with the exception of buildings and equipment, which has an estimated fair value of $720,000. Cash Pittsburg $520,000 Atlanta $ 200,000 Accounts receivable 320,000 240,000 Inventory 1,975,000 Buildings and equipment, net 3,275,000 Total assets $6,090,000 Liabilities $1,935,000 Common stock 3,557,000 240,000 800,000 $1,480,000 $ 320,000 800,000 APIC Retained earnings Total liabilities and equity 300,000 298,000 $6,090,000 $1,480,000 360,000 Required: a. Prepare the journal entry on Pittsburg's books to record the acquisition of the net assets of Atlanta. b. Prepare a balance sheet for Pittsburg immediately after the acquisition of the net assets. C. Prepare the journal entry on Atlanta's books to record the sale of the net assets to Pittsburg. d. Prepare a balance sheet for Atlanta immediately after the sale of their net assets. e. f. Prepare the journal entry on Pittsburg's books to record the acquisition assuming Pittsburg purchased 100% of Atlanta's stock for the 25,000 shares of Pittsburg's stock. If Pittsburg purchased 100% of Atlanta's stock in the acquisition, what journal entry would be made by Atlanta?
Expert Answer:
Related Book For
Modern Advanced Accounting In Canada
ISBN: 9781259066481
7th Edition
Authors: Hilton Murray, Herauf Darrell
Posted Date:
Students also viewed these accounting questions
-
show that Si={(2,1), (3,0)} form a S2 = {(31,-4), (2,5,6), (1,4,8)} basis for R2 and R
-
Refer to the following transactions. a. Sold 4,100 shares of $50 par value preferred stock at $52.50 per share. b. Declared the annual cash dividend of $2.20 per share on common stock. There were...
-
Which of the following accounts does not have a normal credit balance? Service Revenue Sales Discounts Unearned Service Revenue Sales Revenue
-
Margie Johnson is a staff accountant at ToolEx Company, a manufacturer of tools and equipment. The company is under pressure from investors to increase earnings, and the president of the company...
-
The 10-kg collar slides on the smooth vertical rod and has a velocity v 1 = 2 m /s in position A where each spring is stretched 0.1 m. Calculate the velocity v 2 of the collar as it passes point B....
-
What is the purpose of timelines in an investigation?
-
Jellyfish Machine Shop is a manufacturer of motorized carts for vacation resorts. Patrick Cullin, the plant manager of Jellyfish, obtains the following information for Job # 10 in August 2014. A...
-
quick question are they same " the function of database management system and the characteristics of database management system? explain maintaining data integrity and give simple explanation to...
-
Graph the set (xx>-1) on the number line. Then, write the set using interval notation. 7 6 5 4 3 2 1 0 1 2 3 4 5 6 7 O X C ? 0.00.000 0.0 0 -80 X 8 C.
-
Which of the following would not have a FIFO queue discipline? a. Fast-food restaurant b. Post office c. Checkout line at grocery store d. Emergency room at a hospital
-
What is the vector of state probabilities? Where can it be found in a process?
-
Can policymakers minimize tax avoidance? How?
-
Why is it important to consider arrival characteristics in a queuing system?
-
What is the equilibrium condition? Give a working definition of it.
-
The 2011 Wisconsin Act 10 ,what main objections unions had to the legislation.
-
Design an experiment to demonstrate that RNA transcripts are synthesized in the nucleus of eukaryotes and are subsequently transported to the cytoplasm.
-
Intercompany shareholdings of an affiliated group during the year ended December 31, Year 2, were as follows: The equity method is being used for intercompany investments, but no entries have been...
-
If the sales of a foreign subsidiary all occurred on one day during the year, would the sales be translated at the average rate for the year or the rate on the date of the sales? Explain.
-
Explain how the non-controlling interest in the net assets and net income of a subsidiary is reported when the parent owns 90% of the subsidiarys common shares and 30% of the subsidiarys cumulative...
-
Let \(Y\) be distributed according to the \(\operatorname{gamma}(265)\) distribution. (a) Find \(\mathrm{E}[Y]\). (b) Find \(\operatorname{Var}[Y]\). (c) Find \(P(Y>5)\)
-
In order to determine how e ective a magazine is at reaching its target audience, a market research company selects a random sample of people from the target audience and interviews them. Out of the...
-
Let \(Y\) be distributed according to the gamma(12 4) distribution. (a) Find \(\mathrm{E}[Y]\). (b) Find \(\operatorname{Var}[Y]\). (c) Find \(P(Y\)
Study smarter with the SolutionInn App