question archive The stockholder's equity of Thunder Corporation at December 31, 2008 was $ 600,000 consisting of the following (in thousands) Capital stock $ 10 par 42,000 shares outstanding $ 420 Additional paid in capital 80 Retained earnings 100 At May 1, 2009 Thunder Corp which was in a tight working capital position sold 33,000 shares of previously unissued common stock to Lighting Corporation for $ 627,000
The stockholder's equity of Thunder Corporation at December 31, 2008 was $ 600,000 consisting of the following (in thousands) Capital stock $ 10 par 42,000 shares outstanding $ 420 Additional paid in capital 80 Retained earnings 100 At May 1, 2009 Thunder Corp which was in a tight working capital position sold 33,000 shares of previously unissued common stock to Lighting Corporation for $ 627,000
Subject:AccountingPrice: Bought3
The stockholder's equity of Thunder Corporation at December 31, 2008 was $ 600,000 consisting
of the following (in thousands)
Capital stock $ 10 par 42,000 shares outstanding $ 420
Additional paid in capital 80
Retained earnings 100
At May 1, 2009 Thunder Corp which was in a tight working capital position sold 33,000
shares of previously unissued common stock to Lighting Corporation for $ 627,000.
All of Thunder's identifiable assets and liabilities were recorded at fair value on this
date except for a building with a 10-year remaining useful life that was undervalued by
$ 80,000 and Equipment with a 5-year remaining useful life that was overvalued by
$ 100,000
During 2009 Thunder Corporation reported net income of $ 240,000 and paid dividends
quarterly of $ 40,000 -Mar 31,; June 30; Sept 30 and Dec 31 for a total of $ 160,000
for the year
Required
1) What is the amount of goodwill paid by Lighting (2pts)
2) What is Lighting's investment income from Thunder for the year (2 pts)
3) What is the balance in the Investment in Thunder account on Lighting books
at 31 December 2009 (2pts)
4) Prep all journal entries in Lighting books for 2009 to account for its investment in Thunder (6pts)
