Genie Inc. is thinking about undertaking vertical integration by taking over the functions performed by one of their suppliers, Rogers Inc. Genie can either buy the net assets of, or 100% of the outstanding stock of Rogers for $500,000 plus $10,000 in direct acquisition costs. Below is financial information for Rogers as of 7/1/20X1: Assets Cash A/R Inventory Trademark Net Fixed Assets Total Assets $ Accounts Receivable Inventory Trademark Net Fixed Assets Goodwill Acquisition Expenses Book 100,000 50,000 550,000 $ 700,000 Rogers, Inc. Balance Sheet as of 7/1/20x1 A/P Accrued Expenses Common Stock at Par APIC, Common Stoc Cash FMV 75,000 50,000 25,000 300,000 Liabilities A/P Accrued Expenses Equity Total Liabilities & O.E. A) Complete the journal entry made by Genie to account for an asset purchase of Rogers on 7/1/20X1 by entering the proper amounts in the gray-shaded cells. Genie paid for the purchase price by issuing 10,000 shares of its stock which had a market value of $50 per share and a Par Value of $5 per share. When the correct amount is entered, the cell will change color: Account Debit $ 0 Book FMV 25,000 $25,000 75,000 75,000 600,000 $ 700,000 Credit 0
Genie Inc. is thinking about undertaking vertical integration by taking over the functions performed by one of their suppliers, Rogers Inc. Genie can either buy the net assets of, or 100% of the outstanding stock of Rogers for $500,000 plus $10,000 in direct acquisition costs. Below is financial information for Rogers as of 7/1/20X1: Assets Cash A/R Inventory Trademark Net Fixed Assets Total Assets $ Accounts Receivable Inventory Trademark Net Fixed Assets Goodwill Acquisition Expenses Book 100,000 50,000 550,000 $ 700,000 Rogers, Inc. Balance Sheet as of 7/1/20x1 A/P Accrued Expenses Common Stock at Par APIC, Common Stoc Cash FMV 75,000 50,000 25,000 300,000 Liabilities A/P Accrued Expenses Equity Total Liabilities & O.E. A) Complete the journal entry made by Genie to account for an asset purchase of Rogers on 7/1/20X1 by entering the proper amounts in the gray-shaded cells. Genie paid for the purchase price by issuing 10,000 shares of its stock which had a market value of $50 per share and a Par Value of $5 per share. When the correct amount is entered, the cell will change color: Account Debit $ 0 Book FMV 25,000 $25,000 75,000 75,000 600,000 $ 700,000 Credit 0
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:B) Complete the journal entry made by Rogers to account for the asset purchase by Genie on 7/1/20X1 by entering the proper amounts in
the gray-shaded cells. When the correct amount is entered, the cell will change color:
Debit
Account
Marketable Securities in Genie, Inc.
A/P
Accrued Expenses
Loss on Sale of Net Assets
A/R
Inventory
Net Fixed Assets
Investment in Rogers
Acquisition Expenses
0
Common Stock at Par
APIC, Common Stock
Cash
C) Complete the journal entry made by Genie to account for a stock purchase of Rogers on 7/1/20X1 by entering the proper amounts in the
gray-shaded cells. Genie paid for the purchase price by issuing 10,000 shares of its stock which had a market value of $50 per share and a Par
Value of $5 per share. When the correct amount is entered, the cell will change color:
Account
Debit
Credit
0
0
Credit
0
Transcribed Image Text:Genie Inc. is thinking about undertaking vertical integration by taking over the functions performed by one of their suppliers, Rogers Inc.
Genie can either buy the net assets of, or 100% of the outstanding stock of Rogers for $500,000 plus $10,000 in direct acquisition costs.
Below is financial information for Rogers as of 7/1/20X1:
Assets
Cash
A/R
Inventory
Trademark
Net Fixed Assets
Total Assets
$
Book
100,000
50,000
550,000
$ 700,000
$
Accounts Receivable
Inventory
Trademark
Net Fixed Assets
Goodwill
Acquisition Expenses
A/P
Accrued Expenses
Common Stock at Par
APIC, Common Stock
Cash
Rogers, Inc.
Balance Sheet as of 7/1/20x1
FMV
75,000
50,000
25,000
300,000
Liabilities
A/P
Accrued Expenses
Equity
Total Liabilities & O.E.
Debit
$
0
Book
25,000 $
75,000
A) Complete the journal entry made by Genie to account for an asset purchase of Rogers on 7/1/20X1 by entering the proper amounts in the
gray-shaded cells. Genie paid for the purchase price by issuing 10,000 shares of its stock which had a market value of $50 per share and a Par
Value of $5 per share. When the correct amount is entered, the cell will change color:
Account
600,000
$ 700,000
FMV
25,000
75,000
Credit
0
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