Acadia Corporation created Skinny Company as a wholly owned subsidiary by transferring assets and accounts payable to Skinny in exchange...

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Acadia Corporation created Skinny Company as a wholly owned subsidiary by transferring assets and accounts payable to Skinny in exchange for its common stock. Skinny recorded the following entry when it received the assets and accounts payable:

 

DebitCredit   

Cash5,000   

Accounts Receivable 20,000   

Inventory30,000   

Land5,000   

Buildings90,000   

Equipment40,000   

     Accounts Payable17,000   

     Accumulated Depreciation- Buidlings31,000   

     Accumulated Depreciation - Equipment15,000   

     Common Stock50,000   

     Additional Paid in Capital77,0000 

 

Required:

What was Acadia’s book value of the total assets (not net assets) transferred to Skinny Company?

What amount did Acadia report as its investment in Skinny after the transfer?

What number of shares of $10 par value stock did Skinny issue to Acadia?

What impact did the transfer of assets and accounts payable have on the amount reported by Acadia as total assets?

What impact did the transfer of assets and accounts payable have on the amount that Acadia and the consolid

    • 9 years ago
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