Telecom Inc Has Decided to Purchase the Shares of Intron

question 47

Essay

Telecom Inc has decided to purchase the shares of Intron Inc. for $300, 000 in Cash on July 1, 2019. On the date, the balance sheets of each of these companies were as follows:
$\begin{array}{|l|r|r|}\hline & \text { Telecom Inc } & \text { Intron Inc } \\\hline \begin{array}{l}\text { Cash and Short-Term } \\\text { Securities }\end{array} & \$ 920,000 & \$ 200,000 \\\hline \text { Inventory } & \$ 150,000 & \$ 20,000 \\\hline \text { Plant and Equipment (net) } & \$ 330,000 & \$ 180,000 \\\hline \text { Total Assets } & \$ 1,400,000 & \$ 400,000 \\\hline \text { Current Liabilities } & \$ 420,000 & \$ 90,000 \\\hline \text { Bonds Payable } & \$ 700,000 & \$ 200,000 \\\hline \text { Common Shares } & \$ 180,000 & \$ 60,000 \\\hline \text { Retained Earnings } & \$ 100,000 & \$ 50,000 \\\hline \text { Total Liabilities and Equity } & \$ 1,400,000 & \$ 400,000 \\\hline\end{array}$ On that date, the fair values of Intron's assets and liabilities were as follows:
$\begin{array}{|l|r|}\hline \text { Cash/Short-Term Securities } & \$ 200,000 \\\hline \text { Inventory } & \$ 15,000 \\\hline \text { Plant and Equipment (net) } & \$ 400,000 \\\hline \text { Current Liabilities } & \$ 90,000 \\\hline \text { Bonds Payable } & \$ 210,000 \\\hline\end{array}$ Required:
Prepare the Consolidated Balance Sheet on date of acquisition.
Calculation and Allocation of Acquisition Differential:
$\begin{array}{|l|r|}\hline\text { Purchase Price: } & \$ 300,000 \\\hline \text { Less: Net book Value of Net Assets } & 110,000 \\ \text { Acquired } & \\\hline \mathrm{AD} & \$ 190,000 \\\hline \text { Allocated: } & \\\hline \text { Inventory }(15,000-20,000) & (5,000) \\\hline \begin{array}{l}\text { Plant and Equipment (net): }(400,000- \\180,000)\end{array} & 220,000 \\\hline \text { Bonds Payable }(210,000-200,000) & (10,000) \\\hline \text { Goodwill } & (\$ 15,000)\\\hline\end{array}$

Comprehend the role and importance of nursing theories in professional practice.

Acknowledge the historical contributions to nursing theory by foundational nursing theorists.

Understand the process of constructing nursing theories and their modification over time.

Recognize the purpose and comprehensive nature of nursing theory in explaining experiences, describing relationships, and projecting outcomes.

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Definitions:

Agent

A person or entity authorized to act on behalf of another, known as the principal, in commercial transactions or negotiations.

Agency Relationships

A legally binding relationship established between two parties, where one, the agent, is authorized to act on behalf of the other, the principal, in business dealings.

Employment Law

The branch of law that deals with the rights and duties between employers and workers.

Agency Law

A body of law concerned with principal-agent relationships, focusing on the rights and duties that arise when one party acts for or represents another.