Q4) Assume that the following statements of financial position are stated and a
ID: 1175037 • Letter: Q
Question
Q4) Assume that the following statements of financial position are stated and a book value. Construct a post-merger statement of financial position assuming that Amherst Co. purchases Essex Inc. and the pooling of interests method of accounting is used.
Amherst Co.
Current assets
$12,000
Current liabilities
$5,300
Net fixed assets
36,000
Long-term debt
9,800
Equity
32,900
Total
$48,000
Total
$48,000
Essex Inc.
Current assets
$3,400
Current liabilities
$1,300
Net fixed assets
6,400
Long-term debt
1,900
Equity
6,600
Total
$9,800
Total
$9,800
(4 Points)
Amherst Co.
Current assets
$12,000
Current liabilities
$5,300
Net fixed assets
36,000
Long-term debt
9,800
Equity
32,900
Total
$48,000
Total
$48,000
Essex Inc.
Current assets
$3,400
Current liabilities
$1,300
Net fixed assets
6,400
Long-term debt
1,900
Equity
6,600
Total
$9,800
Total
$9,800
Explanation / Answer
Amherst Co.
Post merger Balance sheet
Amherst Co.
Post merger Balance sheet
current asset [12000+3400] 15400 current liabilities [ 5300+1300] 6600 net fixed asset [36000+6400 ] 42400 long term debt [9800+1900] 11700 equity 39500 Total asset 57800 Total liabilities and equity 57800Related Questions
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