Advanced Financial Accounting / ACCT 302

College of Administration and Finance SciencesAssignment (1)
Deadline: Saturday 2/3/2024 @ 23:59
Course Name: Advanced Financial Accounting Student’s Name:
Course Code: ACCT 302
Student’s ID Number:
Semester: Second Semester
CRN: 24922
Academic Year: 1445 H
For Instructor’s Use only
Instructor’s Name: Dr. Mohammed Arshad Khan
Students’ Grade:
/15
Level of Marks: High/Middle/Low
Instructions – PLEASE READ THEM CAREFULLY
● The Assignment must be submitted on Blackboard (WORD format only) via allocated folder.
● Assignments submitted through email will not be accepted.
● Students are advised to make their work clear and well presented, marks may be reduced for
poor presentation. This includes filling your information on the cover page.
● Students must mention question number clearly in their answer.
● Late submission will NOT be accepted.
● Avoid plagiarism, the work should be in your own words, copying from students or other
resources without proper referencing will result in ZERO marks. No exceptions.
● All answers must be typed using Times New Roman (size 12, double-spaced) font. No
pictures containing text will be accepted and will be considered plagiarism.
● Submissions without this cover page will NOT be accepted.
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College of Administration and Finance Sciences
Assignment Question(s):
(Marks 15)
Q1. Z Corporation acquired 100% of the outstanding common stock of Sake X Corporation for
$ 3,000,000 cash and 50,000 shares of its own common stock ($1 par value), which was trading at
$30 per share at the acquisition date.(3 marks)
Required: Prepare The Journal Entry to Record the Acquisition Transaction on the Acquiring
Incorporation’s Journal.
Answer:
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College of Administration and Finance Sciences
Q2. In The Process of the Acquisition, Z Incorporation Paid In Cash the Following Expenses ($): (3
marks)
Legal fees
50,000
Accounting fees
20,000
Travel expenses
5,000
Legal fees (SEC)
40,000
Accounting fees (SEC)
10,000
SEC filing fees
15,000
Required: Prepare the journal entry to record the acquisition expenses.
Answer:
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College of Administration and Finance Sciences
Q3. Z Incorporation acquired significant influence over Y Company by purchasing 100 percent of
the common stock of the Y Incorporation for $100,000; Y earns income of $50,000 and pays
dividends of $10,000(4 marks)
Required: Pass Journal Entries To Update The Investment Account In Y Incorporation Using Equity
Method And Cost Method.
Answer:
4
College of Administration and Finance Sciences
Q4. Given the Following Information for 2023(5 marks)
Z owns 70% of Y
Y net income for 2023 is $150,000
Y declares dividends of $10,000 during 2023.
Y has 20,000 shares of $ 1 par value per stock outstanding that issued for $10 per share.
Y beginning balance in Retained Earnings for 2023 is $50,000.
Required: Prepare Basic Elimination Entry Using Equity Method
Answer
5