On January 1, 2017, Best-western Co. acquired 80 percent of B- Gulf Company's common stock for $160,000 cash. The fair value of the noncontrolling interest at that date was determined to be $40,000. Data from the balance sheets of the two companies included the following amounts as of the date of acquisition: Best western B- Co Corp. $ 60,000 80,000 90,000 100,000 200,000 Gulf Corp. $ 20,000 30,000 40,000 40,000 150,000 Cash Accounts Receivable Inventory Land Buildings and Equipment Less: Accumulated Depreciation (80,000) 160,000 $ 610,000 $ 230,000 (50,000) Investment in B-Gull Co. Total Assets Accounts Payable Bonds Payable $ 110,000 95,000 200,000 205,000 $ 610,000 $ 30,000 40,000 40,000 120,000 $ 230,000 Common Stock Retained Earnings Total Liabilities and Equity On January 1, 2017, the book values of B- Gulf 's net assets and liabilities equal fair value except for inventory, which had a fair value of $45,000, and land, which had a fair value of $60,000.

On January 1, 2017, Best-western Co. acquired 80 percent of B- Gulf Company's common stock for $160,000 cash. The fair value of the noncontrolling interest at that date was determined to be $40,000. Data from the balance sheets of the two companies included the following amounts as of the date of acquisition: Best western B- Co Corp. $ 60,000 80,000 90,000 100,000 200,000 Gulf Corp. $ 20,000 30,000 40,000 40,000 150,000 Cash Accounts Receivable Inventory Land Buildings and Equipment Less: Accumulated Depreciation (80,000) 160,000 $ 610,000 $ 230,000 (50,000) Investment in B-Gull Co. Total Assets Accounts Payable Bonds Payable $ 110,000 95,000 200,000 205,000 $ 610,000 $ 30,000 40,000 40,000 120,000 $ 230,000 Common Stock Retained Earnings Total Liabilities and Equity On January 1, 2017, the book values of B- Gulf 's net assets and liabilities equal fair value except for inventory, which had a fair value of $45,000, and land, which had a fair value of $60,000.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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