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32) On December 31, 20X5, Paper Co. purchased 60% of the outstanding common shares of Book Ltd. for $760,000 in shares and $200,000 in cash. The statements of financial position of Paper and Book immediately before the acquisition and issuance of the notes payable were as follows (in 000s):          Paper        .
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33) On December 31, 20X6, the statements of financial position of the Power Company and the Pro Company are as follows (amounts in thousands): PowerProPro (FV) Cash$   500$   800 Accounts Receivable1,5001,700 Inventories2,0001,500 Plant & Equipment (net)2,5004,000$4,300 Total Assets$6,500$8,000 Current liabilities$   700$   400 Long term liabilities800500$   400 Common shares2,5001,000 Contributed surplus8001,500 Retained earnings1,7004,600 Total Equities$6,500$8,000 Power Company has 100,000 shares of common stock outstanding..
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11) How should negative goodwill be shown on the consolidated financial statements of the acquirer? A) As a gain on the statement of comprehensive income B) As a loss on the statement of comprehensive income C) As a liability on the statement of financial position D) As a separate amount under shareholders' equity on.
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30) Prawn Corporation owns 80 percent of the outstanding voting shares of Shrimp Corporation, having acquired its interest January 1, 20X3 for $100,000. At the time of the acquisition, Shrimp Corporation had a shareholder's equity totalling $150, made up for retained earnings of $30,000 and common shares of $20,000. The.
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30) On December 31, 20X5, Paper Co. purchased 60% of the outstanding common shares of Book Ltd. for $760,000 in shares and $200,000 in cash. The statements of financial position of Paper and Book immediately before the acquisition and issuance of the notes payable were as follows (in 000s):         Paper       .
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34) On December 31, 20X5, Space Co. purchased 100% of the outstanding common shares of Shuttle Ltd. for $1,200,000 in shares and $200,000 in cash. The statements of financial position of Space and Shuttle immediately before the acquisition and issuance of the notes payable were as follows (in 000s):        Space   .
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34) On December 31, 20X6, the statements of financial position of the Power Company and the Pro Company are as follows: (in 000s) PowerPro(FV) Cash$  500$  800 Accounts Receivable1,5001,700 Inventories2,0001,500 Capital assets (net)2,5004,000$4,300 Total Assets$6,500$8,000 Current liabilities$  700$  400 Long term liabilities800500$  550 Common shares  2,5001,000 Contributed surplus8001,500 Retained earnings1,7004,600 Total Equities$6,500$8,000 Power Company has 100,000 shares of common stock outstanding. Pro Company.
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38) Hattrick Corp. is a wholly owned, parent-founded subsidiary of Bobby Inc. The unconsolidated statements of income and the statement of changes of retained earnings for the two companies for the year ended December 31, 20X6, are as follows (in 000s): Statements of Income and Retained Earnings For the year ended December.
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37) Hattrick Corp. is a wholly owned, parent-founded subsidiary of Bobby Inc. Both Bobby and Hattrick report under IFRS. The unconsolidated statements of comprehensive income and part of the statement of changes in equity—retained earnings for the two companies for the year ended December 31, 20X6, are as follows (in.
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  1) On December 31, 20X2, Bates Ltd. purchased 75% of the outstanding common shares of Ted Ltd. for $1,050,000 in cash. The balance sheets of Bates and Ted immediately before the acquisition were as follows (in 000s): Bates Ted Book Value Fair Value Book Value Fair Value Cash $160 $160 $100 $100 Accounts receivable 420 400 280 280 Inventory 600 680 300 350 Capital assets 1,820 2,000 1,320 1,620 $3000 $2,000 Current liabilities $280 $280 $160 1$80 Long-term liabilities 1,100 1,100 900 900 Common shares 500 500 Retained earnings 1,120 440 $3,000 $2,000 At the time of acquisition, Ted's capital assets.
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11) The goodwill impairment test does not involve ________. A) allocation of goodwill to reporting units B) elimination of all goodwill as a consequence C) estimation and judgement on the part of management D) an opportunity for a "big bath" 12) Piri Ltd. acquired 100% of the commons shares of Golden Co. This business combination.
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11) In preparing consolidation working papers, why is it necessary to eliminate intercompany profits? A) To nullify the effect of intercompany transactions on consolidated financial statements B) To defer intercompany profits until the following year C) To allocate unrealized profits until the following year D) To reduce consolidated income 12) Taguchi Ltd. owns 80% of.
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41) Rasor Inc. uses the equity method of reporting its 40% investment in Ivan Co. The balance in the Investment in Ivan was $50,750 at January 1, 20X3. During the next three years, Ivan reported the following net earnings (losses) and dividends paid. Net earnings (loss) $ Dividends paid $ 20X3 135,600 120,000 20X4 15,700 120,000 20X5 (103,400) 0 Required: Calculate the balance of the.
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21) Dupuis Ltd. acquired Waul Ltd. through a business combination using the direct method. How should Waul record this on its books? A) Waul should debit an "Investment in Dupuis" account and credit its share capital account. B) Waul should debit an "Investment in Dupuis" account and remove all its asset and.
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32) On December 31, 20X5, Space Co. purchased 100% of the outstanding common shares of Shuttle Ltd. for $1,200,000 in shares and $200,000 in cash. The statements of financial position of Space and Shuttle immediately before the acquisition and issuance of the notes payable were as follows (in 000s):        Space   .
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Chapter 3  Business Combinations   1) Which of the following is not a business combination? A) Statutory amalgamation B) Joint venture C) A company's purchase of 100% of another company's net assets D) A company's purchase of 80% of another company's voting shares 2) Under IFRS 3, Business Combinations, which method must be used to account for.
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29) Prawn Corporation owns 80 percent of the outstanding voting shares of Shrimp Corporation, having acquired its interest January 1, 20X3 for $100,000. At the time of the acquisition, Shrimp Corporation had a shareholder's equity totalling $150, made up for retained earnings of $30,000 and common shares of $20,000. The.
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37) Sugar Corp and Syrup Limited have reached an agreement in principle to combine their operations as of October 1, 20X9. However, the Board of directors cannot decide on the best way to accomplish the combination. Below are the alternatives being considered: 1.Sugar acquires the net assets of Syrup for $1,700,000.
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36) On January 1, 20X2, Soho Co. purchased 4,000 shares, representing 12%, of Rico Inc. for $78,000. Soho is a publicly traded company. During the next two years, the following information was available for Rico. Net income (loss) Dividends declared Share price December 31 20X2 $65,000 $55,000 $22.20 20X3 $35,000 $10,000 $15.70 Required: a.Assuming Soho classifies this investment as FVTPL, prepare the journal entries.
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