CD Inc. acquires 100% of the outstanding shares of Record Corp. for $1,200,000 and accounts...
90.2K
Verified Solution
Link Copied!
Question
Accounting
CD Inc. acquires 100% of the outstanding shares of Record Corp. for $1,200,000 and accounts for the transaction using the purchase method. Record Corps balance sheet at the date of acquisition appears below:
Record, Corp. Balance Sheet
Acquisition Date
Assets Cash
Historical
Cost
Current Market Value
$ 479,000
$479,000
Accounts Receivable
225,400
210,000
Inventory
98,900
105,000
Depreciable Assets less
Accumulated Depreciation
554,700
600,000
Note Receivable
Goodwill
100,000
100,000
Total Assets
$1,458,000
Liabilities and Equities Accounts Payable
$ 458,000
$458,000
Note Payable
325,000
325,000
Deferred Income Tax Liability
125,000
125,000
Shareholders' Equity
550,000
Total Liabilities and Equities
$1,458,000
Based on the information concerning Record Corp. what is the market value of the company's shareholders' equity at the acquisition date? (Points : 2) $0 $908,000 $1,200,000 $1,458,000
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
