In 2010 company a is formed with 630000 in capital from the, Ask an Expert

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In 2010, Company A is formed with $630,000 in capital from the sale of 21,000 shares at $30 a share. Company A, which has no other operations, immediately acquires 60% of the voting stock of Company S for $630,000. Company S is a business whose fair value of identifiable net assets on the date of Company A's acquisition is $700,000. This amount includes a $30,000 premium that was paid to gain control of Company S. The fair value of the 40% noncontrolling interest is $400,000.Show journal entries to record Company A's investment in Company S under the proportionate method and the fair-value method.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9986426

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