McGuire company acquired 90 percent of Hogan Company on January 1, 2010, for $234,000 cash. This amount is reflective of Hogan's total fair value. Hogan's stockholders' equity consisted of common stock of $160,000 and retained earnings of $80,000.
An analysis of Hogan's net assets revealed the following:
Book Value Fair Value
Buildings (10-year life) $10,000 $8,000
Equipment (4-year life) 14,000 18,000
Land 5,000 12,000
Any excess consideration transferred over fair value is attributable to an unamortized patent with a useful life of 5 years.
In consolidation at December 31, 2011, what adjustment is necessary for Hogan's Equipment account?
A) $1,800 increase
B) No adjustment is necessary
C) $2,000 increase
D) $1,800 decrease
E) $2,000 decrease
Answers (1)
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “McGuire company acquired 90 percent of Hogan Company on January 1, 2010, for $234,000 cash. This amount is reflective of Hogan's total fair ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers
You Might be Interested in
Financial considerations to consider when choosing a location include all except
Answers (1)
Exercise 5-20B Recording estimates of future discounts LO P6 Med Labs has the following December 31 year-end unadjusted balances: Allowance for Sales Discounts, $0; and Accounts Receivable, $5,500.
Answers (1)
If a monopolist is able to increase the amount of product she sells from 400 to 420 units by lowering the price of that product from $50 to $45, her marginal revenue is:
Answers (1)
Given a nominal interest rate of 6 percent, in which of the following cases would you earn the highest after-tax real rate of interest? a. Inflation is 2.5 percent; the tax rate is 25 percent. b. Inflation is 3 percent; the tax rate is 20 percent. c.
Answers (1)
Assume there is an increase in the number of consumers in the market for a good sold by perfectly competitive firms that are initially producing the profit-maximizing level of output. For the individual firm, this would result in:a.
Answers (1)
New Questions in Business
During a certain four-year period, the consumer price index (CPI) increased by 30%, but during the next four-year period, it increased by only 10%. Which of these conditions must have existed during the second four-year period? A. Deflation B.
Answers (2)
Giving a retailer an incentive to sell your product/service is the responsibility of which of the marketing mix?
Answers (1)
Able Graphics received a $780 utility bill for the current month's electricity. It is not due until the end of the next month which is when they intend to pay it.
Answers (1)
Broker Al offers all his agents the ability to sell their own homes without any commission owed the brokerage. In what part of the work agreement might this information be located?
Answers (1)
Olivia deposited $800 at her local credit union in a savings account at the rate of 6.2% paid as simple interest. She will earn interest once a year for the next 7 years.
Answers (1)