Financial and Corporate Accounting: Consolidation and Valuation

Running head: FINANCIAL & CORPORATE ACCOUNTING
Financial and Corporate Accounting
Name of the Student:
Name of the University:
Author’s Note:

1FINANCIAL AND CORPORATE ACCOUNTING
Table of Contents
Requirement a:...........................................................................................................................2
Requirement b:...........................................................................................................................2
Requirement c:...........................................................................................................................5
Requirement d:...........................................................................................................................6
Income Statement:..................................................................................................................6
Balance Sheet:........................................................................................................................7
Bibliography:..............................................................................................................................8

2FINANCIAL AND CORPORATE ACCOUNTING
Requirement a:
Particulars
Carrying
Amount Fair Value Net Fair Value
Share Capital $ 3,00,000 $ 3,00,000
Retained Earnings $ 2,00,000 $ 2,00,000
Plant $ 1,00,000 $ 1,10,000 $ 10,000
Land $ 1,20,000 $ 1,40,000 $ 20,000
Net Fair Value of
Identifiable Assets &
Liabilities $ 5,30,000
Purchase Consideration $ 6,50,000
Goodwill $ 1,20,000
Acquisition Analysis as on 1 July 2009:
Requirement b:
Dr. Cr.
Date Amount Amount
1 Business Combination Valuation Entries:
Accumulated Depreciation A/c. Dr. 30000
To, Plant A/c. $ 20,000
To, Deferred Tax Liability A/c. 3000
To, Business Combination
Valuation Reserve A/c. 7000
Depreciation Expense A/c. Dr. 1000
Retained Earnings (1/7/16) A/c. Dr. 7000
To, Accumulated Depreciation A/c. 8000
Deferred Tax Liability A/c. Dr. 2400
To, Income Tax Expense A/c. 300
To, Retained Earnings (1/7/16) A/c. 2100
Particulars
Consolidation Journal Entries