Balance Sheet Information for Sphinx Company at January 1, 2011

question 8

Essay

Balance sheet information for Sphinx Company at January 1, 2011, is summarized as follows:
Sphinx's assets and liabilities are fairly valued except for plant assets that are undervalued by $50,000.On January 2, 2011, Pyramid Corporation issues 20,000 shares of its $10 par value common stock for all of Sphinx's net assets and Sphinx is dissolved.Market quotations for the two stocks on this date are:
Required:
1.Calculate Pyramid's investment cost of Sphinx Corporation.
2.Calculate any goodwill from the business combination.

Appreciate the importance of valid and reliable performance appraisal systems.

Identify and differentiate between major ethical theories including utilitarianism, deontology, virtue ethics, ethical relativism, and ethics of care.

Understand the application of ethical theories to business decisions and dilemmas.

Recognize the implications of the Sarbanes-Oxley Act on business ethics and practices.

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Definitions:

Competency

The ability of an individual to do a job properly, encompassing knowledge, skills, and behaviors.

Effort

The use of physical or mental energy to achieve something; often involves hard work or striving towards a goal.

Task Difficulty

The level of challenge and effort required to successfully complete a task or assignment.

Constructive Action

Positive and intentional actions taken to improve oneself, help others, or contribute positively to a situation or environment.