Cayce Corporation and Simbel Company Consolidated Financial Statements On January 1, 2014, Cayce Corporation acquired 100 percent of Simbel Company for consideration paid of $126,000, which was equal to its fair value of £504.000. Cayce is a U.S.-based company headquartered in Buffalo, New York, and Simbel is in Cairo, Egypt Cayce accounts for its Investment in Simbel under the equity method. Any excess of fair value over book value is attributable to undervalued land on Simbel's books. Simbel had no retained earnings at the date of acquisition Following are the January 1, 2014 financial statements for Cayce Corporation and Simbel Company before translation of Simbel's financial statements into US dollars. Information for Cayce and for Simbel is in U.S. dollars ($) and Egyptian pounds (E), respectively Simbel Company 390,000 Cash and receivables Inventory Prepaid expenses Investment in Simbel Fixed assets (net) Total assets Accounts payable Notes payable due in 2017 Cayce Corporation 105 244 CE 90.000 30,000 126.000 400.000 751244 60000 132.000 190.000 Prey 3 4 5 of 5 Next > Following are re January 1, 2014 inicidi Salernens tur cayce corporation and Silver Company vendre translation of Simbel's financial statements into U.S. dollars. Information for Cayce and for Simbel is in U.S. dollars ($) and Egyptian pounds (E), respectively. Cash and receivables Inventory Prepaid expenses Investment in Simbel Fixed assets (net) Total assets Accounts payable Notes payable – due in 2017 Common stock Additional pald-in capital Retained earings, 11/14 Total liabilities and equities Cayce Simbel Corporation Company $ 105,244 CE 390,000 90,000 30,000 126.000 400,000 751244 390,000 60.000 132.000 120,000 340.000 83.000 150.000 356 244 175.244 CE390.000 The exchange rate for E on January 1, 2014 was $0 250 per US dollar Cayce Corporation and Simbel Company Consolidated Financial Statement: Required: Cayce Corporation and Simbel Company Consolidated Financial Statemer Required: a. Compute the excess of the fair value of the consideration given over the book value of Simbel's net assets for January 1, 2014 and its allocation to revaluation increments and goodwill. Assume that the Egyptian pound is the subsidiary's functional currency. (Leave no cells blank, enter zeros where appropriate. Amounts to be deducted and negative amounts should be indicated with a minus sign.). Allocation of Excess of Fair Value over Book Value 1/1/14 Exchange U.S. Pounds Rate Dollars Fair value of consideration given 504 000 Book value of net assets Excess of FV over book value 504000 Allocation of excess Revaluation increment for land Goodwil 504.0001 Required information b. Translate Simbel's 1/1/14 financial statements into U.S. dollars for Cayce's Egyptian subsidiary. Assume that the Egyptian pound is the subsidiary's functional currency. (Leave no cells blank, enter zeros where appropriate. Amounts to be deducted and negative amounts should be indicated with a minus sign.) Simbel Company Subsidiary Foreign Currency Financial Statement Translation Worksheet January 1, 2014 Account Egyptian Exchange U.S. Pounds Rate Dollars Cash and receivables 390.000 300 Total assets 390.000 Common stock 12.000 Additional paid-in capital 150 000 Retained earnings 1/1/14 Total liabilities and equities 240.000 390.000 1000 Prey 37 5 5 Dort Required information Separate Consolid-on Worksheet Adj. Financial Statements 100% Cayce Simbel Ref. Dr. Ref. Cr. 105244 5 Account Names 7 Cash and receivables 3 Inventory 9 Prepaid expenses 10 Investment in Simbel Company Consolidated Financial Statements 105,244 90,000 30,000 126,000 90.000 30.000 126.000 (10) 400,000 400.000 751244 60 000 132.000 751 244 60,000 132.000 13 Property, plant and equipment (net) 14 Goodwill 15 Total asset 16 Accounts payable 17 Notes payable 18 Common stock 19 Cayce Corporation Simbel Company 21 Additional paid-in capital: Cayce Corporation 120.000 120.000 20 Simba 22 Carroco 83.000 83.000 Prev 3 4 5 0 5 Next > 751,244 60,000 751,244 60.000 132,000 132,000 120.000 Goodwill Total asset Accounts payable Notes payable Common stock Cayce Corporation Simbel Company Additional paid-in capit Cayce Corporation Simbel Company Retained earnings, 1 Cayce Corporation 5 Simbel Company Total liabilities an 83.000 356 244 751 244 3 4 5 of 5 i Next > Now
bigthoughtwritingservices is a unique service that provides guidance with different types of content. Please rest assured that the service is absolutely legal and doesn’t violate any regulations. It can be used for generating new ideas and thoughts for your own project, additional insight into the subject, or encouragement for further researches.