Acquisition values use fair value.
FV of consideration given/received,which is the more clearly evident. 參F10-3
Acquisition with cash
Dr.Investment in subsidiary
Cr.Cash
Acquisition with parent common stock(use FV at date transaction closes)
Dr.Investment in subsidiary
Cr.C/S(at par)
Cr. A.P.I.C(FV-par)
Acquisition Method Features
100% of the net assets of acquired entity are recorded at fair value.
Unallocated PPA(Purchase Price Allocation)recorded as goodwill
The subsidiary‘s entire equity is eliminated.
Pass Key
Fair Value=Acquisition Price=Investment in subsidiary
CAR IN BIG F3-24
C/S,APIC,R.E of subsidiary are Eliminated.
Investment in subsidiary is eliminated
Noncontrolling interest(NCI)is created
B/S of subsidiary is adjusted to Fair value
Identifiable intangible assets of the subsidiary are recorded at their fair value.F3-32
Goodwill/Gain is squeezed.
Consolidating W/P eliminating journal entry
Dr.C/S
Dr.A.P.I.C
Dr.R.E
Cr.Investment in subsidiary
Cr.Noncontrolling interest
Dr.B/S adjustments to FV
Dr.Identifiable intangible assets to FV
Dr.Goodwill
Subsidiaries fair value(Pass Key F3-25)
FV of subsidiary = Acquisition cost + Noncontrolling interest
FV of subsidiary=(NBV + B/S FV adjustment)+ Identifiable IA FV + Goodwill = FV of B/S + identifiable IA FV + Goodwill
Acquisition cost + noncontrolling interest = FV of B/S + Identifiable IA FV + Goodwill
Subsidiaries fair value(Pass Key F3-25)
企業(yè)被并重評值,總額要由對價定。
評估價值四大塊,賬面價值做基礎。
賬面價值不公允,差額調入合并表。
無形資產如可辯,公允價值表中增。
以上三塊相加后,仍與總額有差異。
差異從來不可辯,記入商譽列表中。
Subsidiaries fair value (Pass Key F3-25)
企業(yè)價值四大塊,最終濃縮為權益。
我是控股大股東,資產負債要全記。
其他股東分額小,但是權益還要占。
防止誤導投資者,非控股東權益出。
老板緊催交合并,大汽車中列表做。
Subsidiaries fair value (Pass Key F3-25)
大汽車里做合并,個別報表按列排。
子方先把權益清,母方再把投資消。(CAR, I)
合并新增四項目,非控股東分凈值。(N)
賬面金額調公允,賬外可辯無形增。(B,I)
商譽總是被擠出,各列相加合并成。(G)
“在大汽車里”CAR IN BIG做合并的注意事項
CAR=Assets-Liabilities=Equity=Net book value
Compute the difference between book value and fair value as of the acquisition date
R.E.Squeeze back to acquisition date
Investment in subsidiary
Capitalize cost
Original cost:FV of the consideration given
Bond issue cost
Expensed cost
Out-of-pocket cost. legal fee,finder‘s fee
Indirect costs
Reverse with A.P.I.C
Stock registration and issuance costs.