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7 February, 23:47

Crawford corporation acquires nashville, inc. the parent pays more for it than the fair value of the subsidiary's net assets. on the acquisition date, crawford has equipment with a book value of $430,000 and a fair value of $609,000. nashville has equipment with a book value of $336,500 and a fair value of $441,500. nashville is going to use push-down accounting. immediately after the acquisition, what amounts in the equipment account appear on nashville's separate balance sheet and on the consolidated balance sheet

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  1. 7 February, 23:48
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    Crawford Corporation acquires Nashville Inc. Since the Nashville is acquired it will be shown in the books of accounts at a fair value while the Crawford is a parent company, its equipment will be shown at the book Value.

    Amount in the equipment account appear:

    On Nashville Inc. (Fair Value) : $441,500

    Amount in the equipment account appear:

    On the consolidated Balance Sheet: ($441,500 + $430,000)

    On the consolidated Balance Sheet = $871,500
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