GUILARAN, KERR JOHN B. BSA51KB1 Problem 14-2 1. Computation of Goodwill/Gain on Acquisition:
Acquisition Cost P Lss! "#i$ %#&u o' Nt Assts G#in on Acquisition
565,000 6(0,000 P
)105,000*
2. Journal ntries:
C#s+ Rci-#&s )CA/ Co$.* In-nto$ Bui&2in3s Equi4nt P#tnt Accounts P##& G#in on Acquisition C#s+ )7OG Co4#n*
P 50,000 150,000 00,000 00,000 0,000 105,000 565,000
To record the acquisition of the net assets of CAT Corporation
Acquisition E8ns C#s+
P
5,000 5,000
To record acquisition-related costs
Problem 14-4 1. Computation of Goodwill/Gain on Acquisition:
Acquisition Cost P Lss! "#i$ %#&u o' Nt Assts Goo29i&&
P
600,000 505,000 :5,000
2. Journal ntries:
C#s+ Accounts Rci-#& In-nto$ L #n 2
P
60,000 100,000 115,000 (0,000
Bui&2in3s Equi4nt Goo29i&& Accounts P##& Bon2s P##& Co44on Stoc< )P10 #$* A22ition#& P#i2=in C#it#&
50,000 :5,000 10,000 1;0,000 10,000 >;0,000
To record the acquisition of the net assets of Tan Company
Acquisition E8ns A22ition#& P#i2=in C#it#& C#s+
P
10,000 1;,000 ;,000
To record acquisition-related costs
Problem 14-! 1. Computation of Goodwill/Gain on Acquisition:
Acquisition Cost )P>0* P Lss! "#i$ %#&u o' Nt Assts
600,000 >0,000
Goo29i&&
P
1;0,000
Acquisition Cost )P0* P Lss! "#i$ %#&u o' Nt Assts
00,000 >0,000
G#in on Acquisition
P
)10,000*
2. Combined "alance #$eet After Acquisition
P4%/s$are
Cash and receivables Inventory Building and equipment !ccumulated depreciation %ood&ill
)*)!+ !-) !ccounts payable Bonds payable Common stoc. P0 Par value !dditional paid(in capital /etained -arnings "including gain rom acquisition$ )*)!+ +I!BI+I)I- !12 )*C*+2-/ -7I)8
P2%/s$are
P
350,000 645,000 ,050,000 "#00,000$ '0,000
P #,0#5,000 P
40,000 4'5,000 450,000 550,000 400,000
P
350,000 645,000 ,050,000 "#00,000$ (
P ,'45,000 P
40,000 4'5,000 450,000 #50,000 5#0,000
P #,0#5,000
P ,'45,000
Problem 14-& 1. Computation of Goodwill/Gain on Acquisition:
Acquisition Cost P Lss! "#i$ %#&u o' Nt Assts Goo29i&&
P
,>00,000 ,00,000 00,000
2. 'ollar(s )ransport Comparati*e #tatement of Compre$ensi*e +ncome:
R-nu ,100,000 Nt Inco4 E#$nin3s $ s+#$ P 5.60
011 P 1,>00,000 500,000
01 01 P 1,;00,000 P 565,000 P 5.00
(00,000 P >.5
Revenue for 2012: P ,000,000 )00,000* P 1,;00,000 Net Income 2012: P 60,000 )55,000* P 565,000 arnin!s per share 2012: P 565,000 ? 15,000 s+#$s @ P >.5 arnin!s per share 201": P (00,000 ? 15,000 s+#$s @ P 5.60 Problem 14-1% a.
Inc$#s in co44on stoc< )P>0,000 P00,000*
P
>0,000 Inc$#s in APIC )P>0,000 P60,000* %#&u o' s+#$s issu2 >00,000
60,000 P
b.
/ot#& #ssts o' Suic #'t$ #cquisition P1,10,000 /ot#& #ssts o' Suic 'o$ #cquisition
650,000
/ot#& '#i$ -#&u o' #ssts o' C&#$< 'o$ co4in#tion P >;0,000
c.
P#$ -#&u o' co44on stoc< #'t$ #cquisition
P
>0,000 P#$ -#&u o' co44on stoc< 'o$ #cquisition 00,000 P#$ -#&u o' co44on stoc< issu2
P
>0,000 7i-i22 #$ -#&u $ s+#$
P5 Nu4$ o' s+#$s issu2
d.
;,000 s+#$s
%#&u o' s+#$s co4ut2 in
P
>00,000 Nu4$ o' s+#$s issu2 #$<t $ic $ s+#$
;,000 P
50
Problem 14-12 1,
Li#i&it '$o4 contin3nt consi2$#tion Loss on contin3nt #4nt C#s+ To record the payment of the Contin!ent #ia$ility
;0,000 >0,000 10,000
011 Inco4 01 Inco4 /ot#& Inco4 7i-i2 A-$#3 Inco4
2,
100,000.00 10,000.00 0,000.00 .00 110,000.00
A-$#3 Inco4 Lss /ot#& u&ti& C#s+ P#4nt
110,000.00 50,000.00 60,000.00 .00 10,000.00
A22ition#& #i2 in c#it#& Co44on stoc<, P1 #$
6,000 6,000
To record issuance for additional stoc%s issued
A-$#3 Inco4 Lss Esti4#t2 Rco-$#& A4ount /ot#& C#$$in3 A4ount 7i-i2 "#i$ %#&u O' Goo29i&& S+#$s to Issu2 Goo29i&& C#$in3 A4ount I4#i$4nt Loss on Goo29i&&
)
110,000.00 50,000.00 >00,00060,000.00 >0000 10 60,000 6,000 100000 >0,000 * ,
A22ition#& #i2 in c#it#& Co44on stoc<, P1 #$ 100,000
100,000
To record the issuance for additional stoc%s issued
7Dcinc )P1 P;* 8 00,000 s+#$s
P;00,000
7i-i22 '#i$ -#&u $ s+#$
;.00
A22ition#& s+#$s to issu2
100,000
Problem 14-14 1. Computation of Goodwill/Gain on Acquisition:
Acquisition Cost P Lss! "#i$ %#&u o' Nt Assts
500,000 >00,000
Goo29i&&
100,000
P
2. a., /+ 3oo29i&& is not i4#i$2. As # $u&, Goo29i&& is consi2$2 to i4#i$2 on& i' c#$$in3 #4ount o' t+ units nt #ssts )inc&u2in3 3oo29i&&* 8c2s t+ $co-$#& #4ount o' t+ unit. b.,
Jou$n#& Ent$! Goo29i&& I4#i$4nt Loss >0,000 Goo29i&& >0,000 To record the impairment of &ood'ill
