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Stonehill BUS 434 Quiz Chapter 4 (2014)

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Question;ADVANCED ACCOUNTING;QUIZ CHAPTER 4, SPRING 2014;On December 31, 2012, Abengoa Corporation paid $782,000 for;all of Enel Company's outstanding common stock. On that date, the costs and;fair values of Enel's recorded assets and liabilities were as follows;Cost;Fair Value;Cash & Receivables;$115,000;$115,000;Inventory;276,000;287,500;Buildings & Equipment, net;460,000;552,000;Liabilities;(230,000);(230,000);Net Assets;$621,000;$724,500;1. Based on the preceding information, the;differential reflected in a consolidation worksheet to prepare a consolidated;balance sheet immediately after the business combination is;A. $0.;B. $57,500.;C. $161,000.;D. $103,500.;2. Based;on the preceding information, what amount should be allocated to goodwill in;the consolidated balance sheet, prepared after this business combination?;A. $0.;B. $57,500.;C. $161,000.;D. $103,500.;3. Metrovacesa Corporation acquired 100% of Pescanova;Corporation?s outstanding capital stock for $430,000 cash. Immediately before;the purchase, the balance sheets of both corporations reported the following;Metrovacesa;Pescanova;Assets;$2,000,000;$750,000;Liabilities;$750,000;$400,000;Common Stock;1,000,000;310,000;Retained Earnings;250,000;40,000;Liabilities & Stockholder?s Equity;$2,000,000;$750,000;At the date of purchase, the fair value of Pescanova?s;assets was $50,000 more than the aggregate carrying amounts. In the;consolidated balance sheet prepared immediately after the purchase, the consolidated;stockholder?s equity should amount to;A. $1,680,000.;B.;$1,650,000.;C.;$1,600,000.;D. $1,250,000.;4. Consolidated financial;statements are being prepared for a parent and its four subsidiaries that have;intercompany loans of $100,000 and intercompany profits of $300,000. How much;of these intercompany loans and profits should be eliminated?;A.;Intercompany loans: $0 / Intercompany profits: $0.;B.;Intercompany loans: $0 / Intercompany profits: $300,000.;C.;Intercompany loans: $100,000 / Intercompany profits: $0.;D. Intercompany loans: $100,000;/ Intercompany profits: $300,000.;Vocento Corporation acquired 100% of Zeltia Corporation?s;common stock on January 1, 2013. Balance sheet data for the two companies;immediately following the acquisition follow;Item;Vocento Corporation;Zeltia Corpration;Cash;$49,000;$30,000;Accounts Receivable;110,000;45,000;Inventory;130,000;70,000;Land;80,000;25,000;Buildings & Equipment;500,000;400,000;Less: Accumulated Depreciation;(223,000);(165,000);Investment in Zeltia Corporation Stock;198,000;Total Assets;$844,000;$405,000;Accounts Payable;$61,500;$28,000;Taxes Payable;95,000;37,000;Bonds Payable;280,000;200,000;Common Stock;150,000;50,000;Retained Earnings;257,500;90,000;Total Liabilities & Stockholders?;Equity;$844,000;$405,000;At the date of the business combination, the book values of;Zeltia's net assets and liabilities approximated fair value except for inventory;which had a fair value of $85,000, and land, which had a fair value of $45,000.;5. Based;on the preceding information, at what amount should total inventory be reported;in the consolidated balance sheet prepared immediately after the business;combination?;A. $70,000;B. $130,000;C. $200,000;D. $215,000;6. Based on the preceding information;what amount of goodwill will be reported in the consolidated balance sheet;prepared immediately after the business combination?;A. $0;B. $23,000;C. $43,000;D. $58,000;7. Based on the preceding information, what amount of;total assets will appear in the consolidated balance sheet prepared immediately;after the business combination?;A. $84,400;B. $1,051,000;C. $1,109,000;D. $1,249,000;8. Based;on the preceding information, what amount of liabilities will be reported in;the consolidated balance sheet prepared immediately after the business;combination?;A. $265,000;B.;$436,500;C.;$701,500;D.;$1,249,000;9. Based on the preceding information, what amount of;retained earnings will be reported in the consolidated balance sheet prepared;immediately after the business combination?;A. $547,500;B. $397,500;C. $347,500;D. $257,500;10. Based on the preceding information, what amount of;total stockholder's equity will be reported in the consolidated balance sheet;prepared immediately after the business combination?;A. $407,500;B. $547,500;C. $844,000;D. $1,249,000;Item;Vocento;Zeltia;Eliminations;Consolidated;DR;CR;Cash;$49,000;$30,000;$79,000;Acc. Receivable;110,000;45,000;155,000;Inventory;130,000;70,000;215,000;Land;80,000;25,000;125,000;Buildings & Eq.;500,000;400,000;900,000;(Ac. Depreciation);(223,000);(165,000);(388,000);Inv. in Zeltia;198,000;0;Goodwill;23,000;Total Assets;$844,000;$405,000;$1,109,000;Acc. Payable;$61,500;$28,000;89,500;Taxes Payable;95,000;37,000;132,000;Bonds Payable;280,000;200,000;480,000;Common Stock;150,000;50,000;150,000;R.E.;257,500;90,000;257,500;Total Liab. & SE;$844,000;$405,000;$1,109,000;5);Amount of Inventory in the Consolidated Balance Sheet;6);Amount of Goodwill in the Consolidated Balance Sheet;7);Amount of Total Assets in the Consolidated Balance Sheet:.;8);Amount of Total Liabilities in the Consolidated Balance Sheet;9);Amount of RE in the Consolidated Balance Sheet;10);Amount of SE in the Consolidated Balance Sheet

 

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