Ask Question
14 November, 21:36

Vader Company purchased 100 percent of the common shares of Skywalker Company by issuing shares of common stock valued at $900,000. Selected accounts from Vader's balance sheet at the date of combination are as follows:Inventory - $700,000 Building and Equipment (net) - 1,400,000 Common Stock - 840,000 Retained Earnings - 2,000,000 Selected accounts from the balance sheet of Skywalker at acquisition are as follows: Inventory - $200,000 Building and Equipment (net) - 900,000 Common Stock - 450,000 Additional Paid-In Capital - 450,000 Retained Earnings - (60,000) On the date of purchase, Skywalker's inventory and buildings and equipment had fair values of $255,000 and $870,000, respectively. Based on the information given above, the amount to be reported for inventory in the consolidated balance sheet immediately after the combination is: 1. $1,000,000 2. $955,000 3. $900,000 4. $700,000 5. None of the above

+1
Answers (1)
  1. 15 November, 00:25
    0
    2. $955,000

    Explanation:

    The computation of the amount to be reported for inventory in the consolidated balance sheet is shown below:

    = Vader inventory value in the balance sheet + Sky-walker inventory value in the balance sheet

    = $700,000 + $255,000

    = $955,000

    Since we have to report the inventory based on the consolidated balance sheet so we added both inventory value that would be presented on each balance sheet
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “Vader Company purchased 100 percent of the common shares of Skywalker Company by issuing shares of common stock valued at $900,000. ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers