Chapter 1 Business Combinations
7) The steadiness sheets of Palisade Firm and Salisbury Company had been as follows on December 31, 2010: Palisade Salisbury Present Belongings $260,000 $120,000 Tools-net 440,000 480,000 Buildings-net 600,000 200,000 Land 100,000 200,000 Whole Belongings $1,400,000 $1,000,000 Present Liabilities 100,000 120,000 Frequent Inventory, $5 par 1,000,000 400,000 Extra paid-in Capital 100,000 280,000 Retained Earnings 200,000 200,000 Whole Liabilities and Stockholders' fairness $1,400,000 $1,000,000 On January 1, 2011 Palisade issued 30,000 of its shares with a market worth of $40 per share in trade for all of Salisbury's shares, and Salisbury was dissolved. Palisade paid $20,000 to register and problem the brand new widespread shares. It value Palisade $50,000 in direct mixture prices. E book values equal market values besides that Salisbury's land is value $250,000. Required: Put together a Palisade steadiness sheet after the enterprise mixture on January 1, 2011. eight) On January 2, 2011, Pilates Inc. paid $900,000 for the entire excellent widespread inventory of Spinning Firm, and dissolved Spinning Firm. The carrying values for Spinning Firm's belongings and liabilities are recorded beneath. Money $200,000 Accounts Receivable 220,000 Copyrights (bought) 400,000 Goodwill 120,000 Liabilities (180,000) Web belongings $760,000 On January 2, 2011, Spinning anticipated gathering $185,000 of the recorded Accounts Receivable. Pilates entered into the acquisition as a result of Spinning had Copyrights that Pilates wished to personal, and additionally unrecorded patents with a good worth of $100,000. Required: Calculate the quantity of goodwill that can be recorded on Pilate's steadiness sheet as of the date of acquisition.