a) Determine if Action must record any goodwill. Show any calculations. b) Record the acquisition in Action's general journal on Feb. 16, 2023. Show: any calculations. c) Prepare any adjusting entry for amortization required as of the fiscal year end, December 31, 2023. If no amortization is required, explain why.
Q: On January 1, 2023 , Linda Corp. changed from the average cost to the dollar value LIFO method for…
A: The company can use different methods to value inventory, and the value of inventory differs when…
Q: In paragraph 44 of Statement of Financial Accounting Standards No. 141, “Business Combinations,” the…
A: In paragraph 44 of Statement of Financial Accounting Standards No. 141, the FASB directed that any…
Q: The following transactions apply to Walnut Enterprises for Year 1, its first year of operations:…
A: Post-closing trial balance is the trial balance that is prepared after closure and transfer of all…
Q: Balance Sheet December 31, 2021 Current Assets: Cash 46,200 Accounts Receivable (net) 260,000…
A: The income statement is an important part of financial statements. It represents the revenues,…
Q: In May Maive Company suit against Wiley, Inc. seeking P850,000 damages for patent infringement. A…
A: Contingent Assets are the assets which arises as a result of past event and the occurrence or non…
Q: Shalom Company prepared its 2023 direct labor budget to produce Product Peace. Producing each unit…
A: The entity prepares a budget to estimate the costs to be incurred. The different types of budgets…
Q: What is a balanced scorecard? Ilustrate the dimensions in a balancedscorecard and give an example of…
A: A balanced scorecard is a strategic performance management tool that helps organizations to align…
Q: "Cultural norms influence a wide range of work preferences including perception of authority,…
A: Cultural values are unwritten rules, customs, aspirations, and beliefs that influence how people…
Q: Luther Inc., has 4,000 shares of 5%, $50 par value, cumulative preferred stock and 100,000 shares of…
A: INTRODUCTION: A dividend is a part of a company's profits and retained earnings that it distributes…
Q: The debits to Work in Process—Roasting Department for Morning Brew Coffee Company for August,…
A: Under FIFO method of accounting while calculating equivalent units, the units in beginning work in…
Q: Calculate the total impact on taxable profit of his personal use of the car, telephone, heat & light…
A: To calculate the total impact on the taxable profit of William's personal use of assets and take…
Q: Brandon Technology makes two models of a specialized sensor for the aerospace industry. The…
A: CONTRIBUTION MARGIN PER UNIT Contribution Margin Per Unit is the Difference between Selling Price…
Q: Use the information in problem 5 to determine the value for a that produces the most accurate ES…
A: Net cash flow is the gain or the loss of funds over a period for an entity (after all the debts have…
Q: Exercise 5-28 (Algo) Methods of Estimating Costs: Engineering Estimates (LO 5-1, 2) Ferdinand…
A: The estimated cost of an asset is the approximate value of that asset based on various factors such…
Q: Hybrid costing Pat Koontz makes necklaces from glass beads, metal beads, and natural beads. After…
A:
Q: Amarillo Company experienced the following events during its first accounting period. (1) Purchased…
A: Balance sheet, income statement and cash flow statement are the financial statements which are…
Q: Pallabi Sekhar Associates, a partnership firm, made these transactions. Find out the effect on…
A: The accounting equation is Assets = Liabilities + Capital.
Q: What is the income tax payable by Mr. Christopher, Non-resident individual (aged 65 years) for the…
A: NON RESIDENT INDIVIDUAL TAXATION Basic Exemption Limit for Non Residential Individual in India Does…
Q: Retirement of Two Partners Thirty years ago, five mechanics formed a partnership and established an…
A: Any sum paid that exceeds that partner's capital account is applied to the capital accounts of the…
Q: The fiscal year of Duchess County ends on December 31. Property taxes are due on March 31 of the…
A: Accrual basis journal entries refer to the financial transactions that are recorded in an accounting…
Q: A company with a net income of $55,000 is looking to compile its operating cash flows for the period…
A: A measure of the amount of money made by a company's regular business activities is called operating…
Q: It was agreed that for the purpose of establishing Dominic's interest, the following revaluations…
A: Revaluation account is required to be made first then resulting output to be transferred to capital…
Q: les Information: Estimated % drop: es: Q4 Q1 Q2 Current Year Q3 Q4 Q1 02 Last Year Next Year
A: Trend analysis used to determine yellow highlighted figures.
Q: The costs per equivalent unit of direct materials and conversion in the Rolling Department of Oak…
A: Calculation of Total Cost assigned to equivalent units Equivalent units…
Q: The partnership agreement specifies that income is divided equally after paying each partner 10…
A:
Q: On January 4, 2021
A:
Q: What is the Cost of Goods Available for Sale for the year? Beginning Inventory: $10,000 Purchase…
A: The price of the raw materials and labor used to produce the completed goods that a company has on…
Q: Ramos Corp. uses a process costing system to assign costs to its steel production. During March,…
A: FIFO stands for First in first out, which is a method of inventory valuation and this method states…
Q: Which of the following would NOT be included in the journal entry to show the conversion of bonds…
A: When a bond is converted into stock, the accounting entry typically involves debiting the bonds…
Q: Gibson Watches, Incorporated makes watches. Its assembly department started the accounting period…
A: Process costing is used to record cost of various process. Finished goods of one process is material…
Q: Equity Common stock Retained earnings Total liabilities and equity Cash flows from operating…
A: Cash flows statement is one of the financial statement of business, under which all cash inflows and…
Q: Manuel Company predicts it will operate at 80% of its productive capacity. Its overhead allocation…
A: Overhead Volume Variance :— It is the difference between total overhead applied and total Budgeted…
Q: Sales - Type Lease (Lessor) (PAS 17 and PFRS 16) Problem 15. Sony Inc. is a lessor-manufacturer of…
A: A lease is an agreement in which the owner of the asset (the lessor) lets another person (the…
Q: b) Quality Footwear incurs these costs for the month: Production wages Advertising costs $ 6 200 $…
A: Product cost is the cost relating to the manufacture of the products. It includes the costs of…
Q: Under U.S. GAAP, when can companies record a change in estimate? (RE&CF 1) Only when FASB has issued…
A: Accounting estimation is an integral part of financial reporting, as many financial statement items…
Q: What is the independent and dependent variable? Labor Cost or Material Cost
A: A variable cost is one that changes depending on the volume of output or the scope of the services…
Q: On March 1 a dressmaker starts work on three custom-designed wedding dresses. The company uses job…
A: The overhead is applied to the production based on pre-determined overhead rate. The applied…
Q: At the time of his death in 2022, Donald owned a farm (a qualified, closely held business) with a…
A: Gross estate = Suitable use value-Current use value 5600000-39200000 $1680000 So, it has been…
Q: Suppose 25% of all college students are business majors; 30% of all college students are women; but…
A: To computer female business majors let's start by finding the proportion of college students who are…
Q: Garton Company had net income of $195,000 in 2020. Depreciation expense for the year is $50,000.…
A: INTRODUCTION: Cash flow from operations is the first of three elements of the cash flow statement…
Q: You want to buy a car, and a local bank will lend you $25,000. The loan will be fully amortized over…
A: Monthly Loan Payment = PV*(r*(1+r)n)((1+r)n-1) where: PV is the present value of the loan r is the…
Q: At the start of the current year, Blue Corporation (a calendar year taxpayer) has accumulated E & P…
A: Pooja and John has equal share in Blue Corporation. The income from profit of business would not be…
Q: Analyze the following two scenarios. What are your recommendations? A county was the recipient of a…
A: The contribution of land donated to the county with the stipulation that it can only be used for the…
Q: 22. Nichols Corporation's accounts payable at December 31, 20x2, totaled P4,500,000 before any…
A: Business transactions are defined as the dealings that take place between the business and its…
Q: a) If a trucking company invested $2,400 of its excess profits at 8% compound interest on December…
A: Future value is the value of money given in the present after a specified period of time in the…
Q: Explain why a provision should be made for the cost of cleaning the site b) Prepare necessary…
A: Capital Investment on Mines Cash cost along with the provision for site restoration is capitalized…
Q: Shalom Company prepared the following sales budget for the first two quarters of 2023: January…
A: In case of multiple subparts, we are allowed to solve only the first 3 subparts. If you want other…
Q: PR 23-1A Direct materials and direct labor variance analysis OBJ. 2, 3 Abbeville Company…
A: Variance analysis is quantitive method of getting comparison between standard data and actual data.…
Q: Based on the reading, (The Auditor’s Consideration of an Entity's Ability to Continue as a Going…
A: The auditor has a responsibility to evaluate the entity’s ability to continue as a going concern…
Q: The following information is available for two different types of businesses for the Year 1…
A: Note : As per accounting standards financial statements of company consists of income statement,…
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
- On January 1, 2021, ABC acquired all the assets and assumed all the liabilities of DEF Co. for P4,500,000. Relevant information follows: ASSETS Carrying Value 55,000 800,000 Fair Values 55,C00 Cash Receivable 800,C00 150,000 700,000 3,500,000 150,000 1,555,000 180,C00 750,C00 4,000,C00 200,C00 1,555,0000 Allowance for Doubtful Accounts Inventory Land Goodwill Liabilities DEC Co. has research and development projects with fair value of P100,000. ABC does not intend to use those R&Ds. However, there have been exchange transactions involving the information generated from DEF, but those transactions are infrequent > All fair value adjustments result to temporary differences but do not affect the tax bases of the assets and liabilities. The taxrate is 30%. > ABC incurred P200,000 on general administrative costs of maintaining an internal acquisition department. Compute the goodwill (gain on bargain purchase)?On 1 July 2021 Collaroy Ltd acquired the following assets and liabilities from Bilgola Ltd Carrying amount Fair value Land $500,000 550,000 Plant ( cost $400,000) 480,000 460,000 Inventory 65,000 63,800 Cash 15,000 15,000 Accounts Receivable 40,000 38,600 Accounts Payable (20,000) (20,000) Loans (110,000) (110,000) In exchange for these assets and liabilities Collaroy issued 160,000 shares at $1.70 per share . At 1 July 2021 these shares had a fair value at $7.35 per share Required Prepare the journal entry for the aboveMachine P was acquired on April 1, 2019 in exchange for 400, 000 face amount of bonds payable selling at 94, and maturing on April 1,2029 . The accountant recorded acquisition by a debit to Machinery and a credit to Bonds Payable for 400, 000 Straight line Depreciation was recorded based on a 5-year economic life and amounted to 54,000 for nine months In the computation of depreciation , residual value of 40,000 was used. What is the initial carrying amount of the PPE? What is the carrying amount if the PPE as of December 31, 2020?
- The general ledger of Proton Corporation as of December 31, 2022, includes the following accounts: Copyrights P 30,000 Deposits with advertising agency (will be used to promote goodwill) 27,000 Bond sinking fund 70,000 Excess of cost over fair value of identifiable net assets of acquired subsidiary 390,000 Trademarks 120,000 In the preparation of Proton's statement of financial position as of December 31, 2022, what should be reported as total intangible assets? O P567,000 O P537,000 O P510,000 O P540,000At December 31, 2023, Sandhill Corp's general ledger includes the following account balances: Copyrights $52500 Deposits with advertising agency (will be used to promote goodwill) 43000 Discount on bonds payable 74000 Excess of cost over fair value of identifiable net assets of acquired subsidiary 589500 Trademarks 106000 In the preparation of Sandhill's balance sheet as of December 31, 2023, what should be reported as total intangible assets? O $158500 O $748000 $791000 O $822000The general ledger of Megan Corporation as of December 31, 2018, includes the following accounts: Copyrights $ 30,000 Deposits with advertising agency (will be used to promote goodwill) 27,000 Bond sinking fund 70,000 Excess of cost over fair value of identifiable net assets of acquired subsidiary 390,000 Trademarks 120,000 In the preparation of Megan's statement of financial position as of December 31, 2018, what should be reported as total intangible assets?
- The fair value of the net identifiable assets of Pax Limited are determined as follows:($000)Patent rights 200Machinery 1,000Buildings 1,500Land 2,3005,000Less: Bank loan 600Net assets 4,400At the end of the reporting period of 30 June 2019, the management of Snowy Ltd determines thatthe recoverable amount of the cash-generating unit, which is considered to be Pax Ltd, totals$4,500,000. The carrying amount of the net identifiable assets of Pax Ltd, excluding goodwill, isunchanged and remains at $4,400,000.Required:a) Prepare the journal entry to account for any impairment of goodwill. (6 marks)b) Assume instead that at the end of the reporting period the management of Snowy Ltd determinesthat the recoverable amount of the cash-generating unit, which is considered to be Pax Ltd, totals$4,200,000. Determine the impairment of goodwill amount.Show the solution in good accounting form Orange Company’s ledger revealed the following account balances as of December 31, 2020: Unamortized discount on bonds payable P120,000; Organization costs P100,000; Losses in early years of company P450,000; Trademarks P750,000 Patents P150,000; Amount set up by BOD as goodwill P300,000. How much should be presented as intangible assets shown In the statement of financial position?9. RGW Industries purchased the net assets of SP Company for P1,300,000. A schedule of the net assets of SP Company, as recorded on SP Company's books at the time of the acquisition, is as follows: Assets Cash Receivable Inventory Land, buildings, and equipment (net) Total assets Liabilities Current liabilities Long-term debt P31,000 250,000 302,000 350,000 P933,000 Inventory Land, building and equipment Patent P90,000 185,000 P275,000 P658,000 Total liabilities Net assets (book value) The following schedule shows the differences between the recorded costs and market values of the assets of SP Company at the date of the acquisition: Cost P302,000 350,000 0 Purchased in-process research and development Existing workforce Totals P652,000 P275,000 Liabilities Determine the amount of goodwill to be recognized on the acquisition? a. P642,000 c. P74,000 b. P464,000 d. P164,000 0 0 Market P400,000 390,000 40,000 300,000 90,000 P1,220,000 P275,000
- Among the assets of Lucas Company on December 31, 2021 are the following:Land held for long-term capital appreciation 3,500,000Land held for a currently undetermined future use 5,700,000Building included in inventory 16,600,000Land held for long-term speculation 1,400,000Equipment leased out under an operating lease 500,000Building rented out under finance lease 10,900,000Land owned by the entity and leased out under an operating lease 7.800,000Building owned by the entity and leased out under operating lease 11,800,000Land held for future site 5,600,000Building that is currently vacant but is held to…On January 2, 2030, Esko Corp. acquired all the net assets of Tolits Inc. Esko Corp. paid P6,000,000 for the net assets of Tolits Inc. On this date, the following accounts of Tolits, Inc. are as follows: Cash – P150,000; Accounts Receivable – P1,600,000; Inventories – P600,000; Property, plant, and equipment – P2,600,000; Accounts Payable – P1,400,000. On the date of acquisition, it was determined that the fair values of inventories and property, plant, and equipment were P660,000 and P3,400,000, respectively. Esko Corp. has estimated a restructuring provision of P500,000 representing costs of exiting the activity of Tolits Inc., cost of terminating the employees of Tolits Inc. Compute the goodwill or gain from acquisition. * a. P 2,950,000 b. P 1,590,000 c. P 2,090,000 d. P 2,450,000 pls. answer it asap thank you:)S Company had the following balances at the time it was acquired by P Company:Cash P36,000Accounts receivable 457,000Inventories 120,000Property, plant and equipment 696,400Goodwill 200,000Accounts payable 350,800P Company paid P1.4M for the net assets of S Company. It was determined that fair market values of inventories and property, plant and equipment were P133,000 and P900,000, respectively.An assumed contingent liability with a fair value amounting to P20,000 and such amount is considered a reliable measurement. Also, a P50,000 future losses or reorganization/ restructuring costs are expected to be incurred as a result of the business combination.In the books of P Company, how will be the amount of Goodwill arising from business combination?