Utah Inc Acquired All of the Outstanding Common Stock of Trimmer

question 69

Essay

Utah Inc. acquired all of the outstanding common stock of Trimmer Corp. on January 1, 2009. At that date, Trimmer owned only three assets and had no liabilities: $\begin{array}{lrr}&\text { Book } & \text { Fair } \\&\text { Value } & \text { Value }\\\text { Inventory } & \$ 36,000 & \$ 48,000 \\\text { Equipment (5-year life) } & 84,000 & 60,000 \\\text { Building (10-year life) } & 120,000 & 180,000\end{array}$
-If Utah paid $300,000 in cash for Trimmer, what allocation should have been assigned to the subsidiary's Building account and its Equipment account in a December 31, 2011 consolidation?

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Definitions:

GDP Declines

A decrease in the gross domestic product, indicating a contraction in a country's economic activity over a specific period.

Indirect Competition

Competition among businesses that aren't direct rivals but offer substitute products or services.

Alternate Solutions

Approaches or methods that differ from the original way to solve a problem or achieve a goal.

Yoplait

A global brand of yogurt produced by Yoplait, known for its wide range of flavoured dairy products.