Advanced Accounting 11th Edition by Paul Fischer,William Tayler, Rita Cheng

Exercise 3

80% purchase, goodwill, consolidated balance sheet. Using the data given in Problem 2-1, assume that Raabe Company exchanged 14,000 of its $40 fair value ($1 par value) shares for 16,000 of the outstanding shares of Dalke Company.
1. Record the investment in Dalke Company and any other purchase-related entry.
2. Prepare the value analysis schedule and the determination and distribution of excess schedule.
3. Prepare a consolidated balance sheet for July 1, 2016, immediately subsequent to the purchase.
Reference:
100% purchase, goodwill, consolidated balance sheet. On July 1, 2016, Raabe Company exchanged 18,000 of its $40 fair value ($1 par value) shares for all the outstanding shares of Dalke Company. Raabe paid acquisition costs of $40,000. The two companies had the following balance sheets on July 1, 2016:
1. Record the investment in Dalke Company and any other entry necessitated by the purchase.
2. Prepare the value analysis and the determination and distribution of excess schedule.
3. Prepare a consolidated balance sheet for July 1, 2016, immediately subsequent to the purchase.