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  • Retained Earnings Pop

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    Wawex Davis
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    The document discusses the acquisition of a subsidiary called Sam by a parent company. It provides financial information on the parent company's stockholders' equity which totaled $2,590,000. It also details the current assets of Sam which were $42,000 after eliminating intercompany balances. The fair value of Sam's net assets after acquisition was estimated to be $125,000 based on the non-controlling interest's share of $25,000. Goodwill of $7,500 was recognized from the acquisition.

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    Retained Earnings Pop

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    The document discusses the acquisition of a subsidiary called Sam by a parent company. It provides financial information on the parent company's stockholders' equity which totaled $2,590,000. It also details the current assets of Sam which were $42,000 after eliminating intercompany balances. The fair value of Sam's net assets after acquisition was estimated to be $125,000 based on the non-controlling interest's share of $25,000. Goodwill of $7,500 was recognized from the acquisition.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
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    3 views2 pages

    Retained Earnings Pop

    Uploaded by

    Wawex Davis
    The document discusses the acquisition of a subsidiary called Sam by a parent company. It provides financial information on the parent company's stockholders' equity which totaled $2,590,000. It also details the current assets of Sam which were $42,000 after eliminating intercompany balances. The fair value of Sam's net assets after acquisition was estimated to be $125,000 based on the non-controlling interest's share of $25,000. Goodwill of $7,500 was recognized from the acquisition.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
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    of 2

    Capital stock Pop P 1,500,000

    Retained earnings Pop

    Controlling interest

    NCI 140,000
    Stockholders' equity P 2,590,000

    9.
    Consolidated current assets P140,000
    Current assets a Pit 106,000
    Current assets elimination is Sam P40,000
    Intercompany receivable eliminated 2,000
    Current assets Sam P 42,000

    10.
    Fair value of net assets after P125,000

    acquisition Sam

    (P25,000/20%)

    Less allocated excess:


    Plant and equipment P12,500
    Goodwill 7,500 20,000
    Book value of identifiable net P

    assets before acquisition 105,000

    11.
    Price paid (parent) P2,000,000
    Divided by parent's interest ÷80%
    Implied value of subsidiary P2,500,000
    NCI share x20%
    implied fair value of NCI P500,000

    12.

    NCI at implied fair value P 500,000


    Price paid (parent)

    Total

    Less book value of identifiable 1,875,000

    net assets Sure


    Excess 625,000

    Allocation/adjustments:
    'inventories P(100,000)
    adding (200,000)

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