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Top Corporation acquired 100 percent of Sun Corporation's common stock on December 31, 2012
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Top Corporation acquired 100 percent of Sun Corporation's common stock on December 31, 2012. Balance sheet data for the two companies immediately following the acquisition follow: |
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Item |
Top Corporation |
Sun |
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Cash |
|
$ |
49,000 |
|
|
$ |
30,000 |
|
|
|
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Accounts Receivable |
|
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110,000 |
|
|
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45,000 |
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|
|
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Inventory |
|
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130,000 |
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|
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70,000 |
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|
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Land |
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80,000 |
|
|
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25,000 |
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|
|
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Buildings & Equipment |
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500,000 |
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|
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400,000 |
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|
|
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Less: Accumulated Depreciation |
|
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(223,000 |
) |
|
|
(165,000 |
) |
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|
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Investment in Sun Corporation Stock |
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198,000 |
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Total Assets |
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$ |
844,000 |
|
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$ |
405,000 |
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Accounts Payable |
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$ |
61,500 |
|
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$ |
28,000 |
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Taxes Payable |
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95,000 |
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37,000 |
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Bonds Payable |
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280,000 |
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200,000 |
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Common Stock |
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150,000 |
|
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50,000 |
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Retained Earnings |
|
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257,500 |
|
|
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90,000 |
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Total Liabilities & Stockholders’ Equity |
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$ |
844,000 |
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$ |
405,000 |
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At the date of the business combination, the book values of Sun'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. |
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Required: |
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For each question, indicate the appropriate total that should appear in the consolidated balance sheet prepared immediately after the business combination. |
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1. |
What amount of inventory will be reported? |
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2. What amount of goodwill will be reported? |
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3. What amount of total assets will be reported? |
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|
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5. What amount of consolidated retained earnings will be reported? |
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6. What amount of total stockholders’ equity will be reported? |
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