On January 1, 2017, Holland Corporation paid $8 per share to a group of Zeeland Corporation…

On January 1, 2017, Holland Corporation paid $8 per share to a group of Zeeland Corporation shareholders to acquire 60,000 shares of Zeeland s outstanding voting stock, representing a 60 percent ownership interest. The remaining 40,000 shares of Zeeland continued to trade in the market close to its recent average of $6.50 per share both before and after the acquisition by Holland. Zeeland s acquisition date balance sheet follows: On January 1, 2017, Holland assessed the carrying amount of Zeeland s equipment (5-year remaining life) to be undervalued by $55,000. Holland also determined that Zeeland possessed unrecorded patents (10-year remaining life) worth $285,000. Zeeland s acquisition-date fair values for its current assets and liabilities were equal to their carrying amounts. Any remaining excess of Zeeland s acquisition-date fair value over its book value was attributed to goodwill. The companies financial statements for the year ending December 31, 2018, follow: At year-end, there were no intra-entity receivables or payables. a. Compute the amount of goodwill recognized in Holland s acquisition of Zeeland and the allocation of goodwill to the controlling and non-controlling interest. b. Show how Holland determined its December 31, 2018, Investment in Zeeland account balance. c. Prepare a worksheet to determine the amounts that should appear on Holland s December 31, 2018, consolidated financial statements?

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