On January 1, 2013, the Moody Company entered into a transaction for 100% of the outstanding common stock of Osorio Company. To acquire these shares, Moody issued $400 in long-term liabilities and also issued 40 shares of common stock having a par value of $1 per share but a fair value of $10 per share. Moody paid $20 to lawyers, accountants, and brokers for assistance in bringing about this acquisition. Another $15 was paid in connection with stock issuance costs. Prior to these transactions, the balance sheets for the two companies were as follows: Moody OsorioCash$180 $40 Receivables 810 180 Inventories 1,080 280 Land 600 360 Buildings (net) 1,260 440 Equipment (net) 480 100 Accounts payable (450) (80)Long-term
liabilities (1,290) (400)Common stock ($1 par) (330) Common stock ($20 par) (240)Additional paid-in capital (1,080) (340)Retained earnings (1,260) (340)??Note: Parentheses indicate a credit balance.??In Moody's appraisal of Osorio, three assets were deemed to be undervalued on the subsidiary's books: Inventory by $10, Land by $40, and Buildings by $60.?Compute the amount of consolidated inventories at date of acquisition.
A. $1,370.
B. $1,080.
C. $290.
D. $1,360.
E. $1,350.
Answer: A
You might also like to view...
The perceptual process is affected by which of the following factors?
A) prior experiences B) psychological state C) prior knowledge D) all of the above
Narrowing in on a solution and considering its course of action and consequences comes in which stage of the Five “I” Format?
A. innovate B. investigate C. isolate D. implement
Phone calls that update clients on new prices, products, or services are examples of
A) Internal communication. B) External communication. C) Internal and external communication
Probably the most common organizational structure, and one that utilizes separate departments that specialize in that activity (such as marketing or production) is known as the ____________________ structure.
Fill in the blank(s) with the appropriate word(s).