PROBLEM 1

a. Fair value of consideration 178,000

Fair value of net assets 140,000
Goodwill 38,000

Cash 20,000
Accounts Receivable 35,000
Inventory 50,000
Patents 60,000
Buildings & Equipmen 150,000
Goodwill 38,000
Accounts Payable 55,000
Bonds Payable 120,000
Cash 178,000

b. Anchor Corporation
Statement of Financial Position
February 1, 2017
Assets
Cash 82,000
Accounts Receivable 175,000
Inventory 220,000
Patents 140,000
Buildings & Equipment 530,000
Acc. Depreciation (190,000)
Goodwill 38,000
995,000
Liabilities and Equity
Accounts Payable 140,000
Bonds Payable 270,000
Common Stock
$10 par value 200,000
$6 par value
Additional Paid-in Capital 160,000
Retained Earnings 225,000
995,000

c. Investment in Zink Company 178,000

Cash 178,000
PROBLEM 2

Carrying amount 550,000

Fair value 375,000
Impairment 175,000

Loss on Impairment 175,000

Goodwill 150,000
Land 1,875
Buildings 13,125
Equipment 10,000
PROBLEM 2B

a.
A B C
Carrying amount 70,000 80,000 40,000
Implied goodwill 90,000 50,000 75,000
To be reported 70,000 50,000 40,000

b.
Impairment loss = 80000 - 50000 = 30000

Loss on Impairment 30,000

Goodwill 30,000
PROBLEM 3

a.
Fair value of consideration 600,000
Fair value of net assets 475,000
Goodwill 125,000

Cash 30,000
Accounts Receivable 60,000
Inventory 160,000
Land 30,000
Buildings & Equipment 350,000
Goodwill 125,000
Accounts Payable 10,000
Bonds Payable 145,000
Share Capital - Ordinary 80,000
Share Premium - Ordinary 520,000

b. Ramrod Manufacturing
Statement of Financial Position
January 1, 2017
Assets
Cash 100,000
Accounts Receivable 160,000
Inventory 360,000
Land 80,000
Buildings & Equipment 950,000
Acc. Depreciation (250,000)
Goodwill 125,000
1,525,000
Liabilities and Equity
Accounts Payable 60,000
Bonds Payable 445,000
Share Capital - Ordinary 280,000
Share Premium - Ordinary 560,000
Retained Earnings 180,000
1,525,000
PROBLEM 4

Cash & Receivables 50000

Inventory 150000
Building & Equipment 300000
Patent 200000
Acquisition Cost 5000
Accounts Payable 30000
Cash 625000
Gain 50000
PROBLEM 5

Perusahaan Porsi Kepemilikan Perlakuan Akuntansi

PT Bugenfil 0.45 Equity method
PT Cempaka 0.25 Equity method
PT Dahlia 0.15 Cost method
PT Edelweis 0.15 Cost method

Tanggal PT Bugenfil PT Cempaka PT Dahlia (AFS

1-Jan-17 Stock Investment 909000 Stock Investment 505000 Stock Investment
Cash 909000 Cash 505000 Cash

1-Nov-17 Dividends Receivable 675000 Dividends Receivable 375000 Dividends Receivable

Stock Investment 675000 Stock Investment 375000 Dividends Revenu
1-Dec-17 no entry no entry no entry
15-Dec-17 Cash 675000 Cash 375000 Cash
Dividends Receiva 675000 Dividends Receivable 375000 Dividends Receiva
31-Dec-17 Stock Investment 2250000 Stock Investment 1250000
no entry
Income from PT An 2250000 Income from PT An 1250000
31-Dec-17 Fair Value Adjustmen
no entry no entry Unrealized Holding Gain
Loss - Equity

15-Mar-17 Cash 330000

Stock Investment 300000
Gain on Sale 30000
 PT Dahlia (AFS) PT Edelweis (Trading)
Stock Investment 303000 Stock Investment 300000
Cash 303000 Brokerage Fee 3000
Cash 303000
Dividends Receivable 225000 Dividends Receivable 225000
Dividends Revenu 225000 Dividends Revenu 225000
no entry no entry
Cash 225000 Cash 225000
Dividends Receiva 225000 Dividends Receiva 225000
no entry no entry

Fair Value Adjustmen 12000 Fair Value Adjustmen 15000

12000 15000
Unrealized Holding Gain or Unrealized Holding Gain or
Loss - Equity Loss - Income