Inventory and Economic Unit Concept

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Chapter 4
When Jolt Co. acquired 75% of the common stock of Yelts Corp., Yelts owned land with a book value of $70,000 and a fair value of $100,000 2. What amount should have been reported for the land on a consolidated balance sheet, according to SFAS141(R), assuming the economic unit concept  was used?

A.$70,000
B.$75,000
C.$85,000
D.$92,500
E.$100,000
3. What amount of excess land allocation would be included for the calculation of non-controlling interest,according to SFAS 141(R)? A.$0
B.$7,500
C.$17,500
D.$25,000
E.$70,000
4. What amount should have been reported for the land on a consolidated balance sheet, assuming theinvestment was obtained prior to SFAS 141(R) and the parent company concept was used? A.$70,000
B.$75,000
C.$85,000
D.$92,500
E.$100,000
 
Perch Co. acquired 80% of the common stock of Float Corp. for $1,600,000. The fair value of Float's net assetswas $1,850,000 and the book value was $1,500,000. The non-controlling interest shares of Float Corp. are notactively traded. 5. What is the total amount of goodwill recognized according to the economic unit concept per SFAS 141 (R)? A.$150,000

B.$250,000
C.$0
D.$120,000
E.$170,000
 
6. What amount of goodwill should be attributed to Perch according to the economic unit concept per SFAS141(R)? A.$150,000
B.$250,000
C.$0
D.$120,000
E.$170,000
 
7. What amount of goodwill should be attributed to the non-controlling interest according to the economic unitconcept per SFAS 141(R)? A.$0
B.$20,000
C.$30,000
D.$100,000
E.$120,000
8. What is the dollar amount of non-controlling interest which should appear on a balance sheet preparedimmediately after consolidation according to the economic unit concept per SFAS 141(R)? A.$350,000

B.$300,000
C.$400,000
D.$370,000
E.$0
9. What is the dollar amount of Float Corp.'s net assets that would be represented on a balance sheet preparedimmediately after consolidation according to the economic unit concept per SFAS 141(R)? A.$1,600,000

B.$1,480,000
C.$1,200,000
D.$1,780,000
E.$1,850,000
10. What is the dollar amount of non-controlling interest which should appear on a balance sheet preparedimmediately after consolidation according to the parent company concept? A.$350,000
B.$300,000
C.$400,000
D.$250,000
E.$0
 
Royce Co. acquired 60% of Park Co. for $420,000 when Park's book value was $560,000. On that date, Park had equipment (with a ten-year life) that was undervalued in the financial records by $140,000. Two years later,the following figures were reported by the two companies (stockholders' equity accounts have been omittedfrom their separate operations). Royce accounts for its consolidations according to SFAS 141(R) and SFAS160.  

18. What is consolidated net income that is attributable to Royce's controlling interest? A.$686,000
B.$560,000
C.$644,000
D.$635,600
E.$691,600

19. What is the non-controlling interest's share of the subsidiary's net income and what is the ending balance of the non-controlling interest in the subsidiary? A.$50,400 and $324,800
B.$53,648 and $304,500
C.$56,000 and $296,800
D.$52,640 and $313,600
E.$55,270 and $297,300
 
20. What is the consolidated balance of the Equipment account? A.$666,400
B.$604,000
C.$756,000
D.$711,200
E.$764,000
 
On January 1, 2009, Palk Corp. and Spraz Corp. had condensed balance sheets as follows:On January 2, 2009, Palk borrowed $84,000 to acquire 90% of the outstanding common shares of Spraz. Thiswas to be paid in ten equal annual principal payments, plus interest, beginning December 31, 2009. The excessconsideration transferred over the underlying book value of the acquired net assets was allocated 60% toinventory and 40% to goodwill. Palk accounts for its consolidations according to SFAS 141(R) and SFAS 160.  

21. What is consolidated current assets as of January 2, 2009? A.$138,600
B.$134,400
C.$126,000
D.$140,000
E.$127,400

22. What is consolidated noncurrent assets as of January 2,...
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