Consider the following premerger information about Firm X and Firm Y: Firm X Firm Y $79,000 $14,000 36,000 11,000 Total earnings Shares outstanding Per-share values: Market Book $ $ LA LA 51 $ 16 11 $ 6 Assume that Firm X acquires Firm Y by paying cash for all the shares outstanding at a merger premium of $8 per share, and that neither firm has any debt before or after the merger. Construct the postmerger balance sheet for Firm X assuming the use of the purchase accounting method. (Do not round intermediate calculations and round your answers to the nearest whole number, e.g., 32.)
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- Consider the following premerger information about Firm X and Firm Y: 222 Total earnings Shares outstanding Per-share values: Market Book Firm X $92,000 49,000 Assets from X Assets from Y Goodwill Total Assets XY LA GA Firm Y $20,500 14,000 49 $ 18 $ 20 7 zursurch of M www.am entrat human pa grawe anakmuom 2 Hoe o Assume that Firm X acquires Firm Y by paying cash for all the shares outstanding at a merger premium of $7 per share, and that neither firm has any debt before or after the merger. Construct the postmerger balance sheet for Firm X assuming the use of the purchase accounting method. (Do not round intermediate calculations and round your answers to the nearest whole number, e.g., 32.)4. An entity showed the following data:Share capital, par value P50 5,000,000Share premium 200,000Retained Earnings 2,000,000Market value of share on declaration date 75Market value of share on distribution date 85Treat each item independently: a. If the entity would declare a 1 for 5 share dividend, what amount would be charged to retained earnings? b. What amount will be credited to share premium if the entity would declare 15% share dividend?A Ltd is acquiring B Ltd and will pay consideration totally through shares. The financial data of both companies are given below : A LTD B LTD PROFITS 800000 300000 NO.OF EQUITY SHARES 400000 200000 EPS 2 1.5 P/E RATIO 12 7 Calculate the following: 1. Market price of each company share? 2. Market Capitalization of each company 3. Find out the Exchange Ratio(Swap Ratio)
- Read and understand the problem below. Write the answer on the space provided below. The capital accounts of X and Y Company before the admission of Z are as follows: Capital accounts P/L ratios X, Capital P100,000 30% Y, Capital 200,000 70% P300,000 Case 1 Z purchases 10% interest out of the 30% interest of A for P100, 000. The net assets of the firm as of this date approximate their fair values. Provide the journal entry to record the transaction. Case 2 Z purchases 10% interest in the partnership by investing P70,000 cash to the business. The net assets of the firm as of this date approximate their fair values. Requirements: Provide the journal entry to record the admission of Z.(show your computation below) Compute for capital balances of the partners after the admission of Z. (show your computation below) Compute for the new P/L ratios of the partners.What is the par value per share? * Mars Corporation recorded the following joumal entry: Land Preference share capital Share premium-preference To record issuance of preference shores @120 Per share. 450,000 420,000 30,0004. An entity showed the following data:Share capital, par value P50 5,000,000Share premium 200,000Retained Earnings 2,000,000Market value of share on declaration date 75Market value of share on distribution date 85Treat each item independently: c. How much would be the total shareholders’ equity after a 10% share dividend declaration? d. If the entity would declare a 1 for 5 share split, What would be the balance of retained earnings?
- Consider the following premerger information about a bidding firm (Firm B) and a target firm (Firm T). Assume that both firms have no debt outstanding. Shares outstanding Price per share Firm B 5,000 $ 42 Firm T 1,600 $17 Firm B has estimated that the value of the synergistic benefits from acquiring Firm T is $9,000. Firm T can be acquired for $19 per share in cash or by exchange of stock wherein B offers one of its share for every two of T's shares. a. Shareholders of Firm T b. Exchange ratio a. Are the shareholders of Firm T better off with the cash offer or the stock offer? b. At what exchange ratio of B shares to T shares would the shareholders in T be indifferent between the two offers? (Do not round intermediate calculations and round your answer to 4 decimal places, e.g., 32.1616.) to 1Consider the following premerger information about a bidding firm (Firm B) and a target firm (Firm T). Assume that both firms have no debt outstanding. Shares outstanding Price per share Firm B Firm T 6,200 1,400 $ 48 $ 18 Firm B has estimated that the value of the synergistic benefits from acquiring Firm T is $9,600. Firm T can be acquired for $20 per share in cash or by exchange of stock wherein B offers one of its shares for every two of T's shares. Are the shareholders of Firm T better off with the cash offer or the stock offer? Cash offer is better Share offer is better At what exchange ratio of B shares to T shares would the shareholders in T be indifferent between the two offers? (Do not round intermediate calculations and round your answer to 4 decimal places, e.g., 32.1616.) Exchange ratio to 1The following data pertains to Traverse Co.'s investments in marketable equity securities: Select one: Oa. $55,000 gain O b. $55,000 loss c. $50,000 loss Od $50,000 gain Oe $0 Cost $150,000 Clear my choice Market value 12/31/24 $155,000 12/31/25 What amount should Traverse Co. report as unrealized holding gain/loss to be included in 2025 Comprehensive Income? $100,000
- You are given the following information: ordinary shares, P80,000 (P80par); Share Premium-Ordinary, 200,000; and Retained Earnings, P400,000.Assuming only one class of share, the book value per share is? a.P280 b. P680 c. P80 d. P400World Enterprises is determined to acquire Intous Ltd through exchanging stocks. World Enterprises is offering R65 per share for Intous ltd. You are given the following information World Enterprises Intous Ltd Net Income R50 R10 Shares outstanding 5000 2000 Earnings per share R10 R5 Market price per share R150 Price earnings ratio R15 a. Calculate the number of shares to be issued by Intous Ltd: b. Calculate combined earnings per share of both World Enterprise and Intous Ltd c. Calculate price earnings ratio (P/E ratio) paid (Hint: use the R65 to calculate the P/E ratio) d. Compare the current and paid P / E ratiosConsider the following premerger information about a bidding firm (Firm B) and a target firm (Firm T). Assume that both firms have no debt outstanding. Firm B Firm T 1,300 $23 Shares outstanding 5,400 Price per share $53 Firm B has estimated that the value of the synergistic benefits from acquiring Firm T is $7,900. Firm T can be acquired for $25 per share in cash or by exchange of stock wherein B offers one of its share for every two of T's shares. Are the shareholders of Firm T better off with the cash offer or the stock offer? O Share offer is better O Cash offer is better At what exchange ratio of B shares to T shares would the shareholders in T be indifferent between the two offers? (Do not round intermediate calculations and round your answer to 4 decimal places, e.g., 32.1616.) Exchange ratio