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  • BUSICOM - Net Asset Acquisition

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    Dheine Maderazo
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    Ronselle Co. acquired LJ Corp. on April 7, 2019. According to LJ Corp.'s statement of financial position on April 1, 2019, its total assets were $460,000 and total liabilities were $120,000. However, the fair values of LJ Corp.'s assets and liabilities as of the acquisition date differed, with total assets of $470,000. As Ronselle Co. paid $620,000 in consideration and the fair value of net assets acquired was $470,000, goodwill of $150,000 resulted from the acquisition.

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    BUSICOM- Net Asset Acquisition

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    Ronselle Co. acquired LJ Corp. on April 7, 2019. According to LJ Corp.'s statement of financial position on April 1, 2019, its total assets were $460,000 and total liabilities were $120,000. However, the fair values of LJ Corp.'s assets and liabilities as of the acquisition date differed, with total assets of $470,000. As Ronselle Co. paid $620,000 in consideration and the fair value of net assets acquired was $470,000, goodwill of $150,000 resulted from the acquisition.

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    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
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    6 views3 pages

    BUSICOM - Net Asset Acquisition

    Uploaded by

    Dheine Maderazo
    Ronselle Co. acquired LJ Corp. on April 7, 2019. According to LJ Corp.'s statement of financial position on April 1, 2019, its total assets were $460,000 and total liabilities were $120,000. However, the fair values of LJ Corp.'s assets and liabilities as of the acquisition date differed, with total assets of $470,000. As Ronselle Co. paid $620,000 in consideration and the fair value of net assets acquired was $470,000, goodwill of $150,000 resulted from the acquisition.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as xlsx, pdf, or txt
    of 3

    Maderazo, Dheine Louise L.

    BSA = A3A
    Exercise: Goodwill or Gain on Bargain Purchase

    LJ Corp.
    Statement of Financial Position
    April 1, 2019

    Cash 60,000.00
    Inventory 180,000.00
    Equipment (net) 220,000.00
    TOTAL ASSETS 460,000.00

    Total liabilities 120,000.00

    Consideration given
    Fair value of net assets of J&J
    Goodwill

    JOURNAL ENTRIES
    ACQUIRER (Ronselle Co.)

    April 7 Cash
    Inventory
    Equipment (net)
    Goodwill
    Liabilities
    Ordinary Share Capital
    Additional paid-in capital
    LJ Corp.
    Fair Values
    as of April 1, 2019

    Cash 60,000.00
    Inventory 150,000.00
    Equipment (net) 380,000.00

    Total liabilities 120,000.00


    NET ASSET 470,000.00

    620,000.00
    470,000.00
    150,000.00

    60,000.00
    150,000.00
    380,000.00
    150,000.00
    120,000.00
    y Share Capital 400,000.00
    nal paid-in capital 220,000.00
    Difference
    -
    (30,000.00)
    160,000.00

    -
    130,000.00

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