Answered

At Westonci.ca, we provide reliable answers to your questions from a community of experts. Start exploring today! Connect with a community of experts ready to help you find solutions to your questions quickly and accurately. Experience the ease of finding precise answers to your questions from a knowledgeable community of experts.

On August 31, Planar Corp. exchanged 100,000 shares of its $40 par value common stock for all of the net assets of Sistrock Co. The fair value of Planar's common stock on August 31 was $72 per share. Planar paid a fee of $320,000 to the consultant who arranged this acquisition. Direct costs of registering and issuing the equity securities amounted to $160,000. No goodwill or bargain purchase was involved in the acquisition. At what amount should Planar record the acquisition of Sistrock's net assets

Sagot :

abiolataiwo2015

Answer:

$7,200,000

Explanation:

Calculation to determine At what amount should Planar record the acquisition of Sistrock's net assets

Using this formula

Acquisition of Sistrock's net assets =(Shares of common stock issued ×Common stock fair value per share

Let plug in the formula

Acquisition of Sistrock's net assets=100,000*$72

Acquisition of Sistrock's net assets=$7,200,000

Therefore the amount that Planar should record the acquisition of Sistrock's net assets is $7,200,000

Thank you for visiting our platform. We hope you found the answers you were looking for. Come back anytime you need more information. We appreciate your time. Please come back anytime for the latest information and answers to your questions. Thank you for trusting Westonci.ca. Don't forget to revisit us for more accurate and insightful answers.