Snowflake Corp.
Penguin, Inc. acquires 100% of the outstanding shares of Snowflake Corp. for $2,250,000 and accounts for the transaction using the purchase method. Snowflake's balance sheet at the acquisition date is as follows:

Based on the information concerning Snowflake Corp. what is the market value of the company's shareholders' equity at the acquisition date?
A) $1,775,000
B) $475,000
C) $2,250,000
D) $0

Question

Snowflake Corp.
Penguin, Inc. acquires 100% of the outstanding shares of Snowflake Corp. for $2,250,000 and accounts for the transaction using the purchase method. Snowflake's balance sheet at the acquisition date is as follows:

Based on the information concerning Snowflake Corp. what is the market value of the company's shareholders' equity at the acquisition date?
A) $1,775,000 
B) $475,000 
C) $2,250,000 
D) $0

Quizplus · Accepted Answer

The Answer of Snowflake Corp.
Penguin, Inc. acquires 100% of the outstanding shares of Snowflake Corp. for $2,250,000 and accounts for the transaction using the purchase method. Snowflake's balance sheet at the acquisition date is as follows:

Based on the information concerning Snowflake Corp. what is the market value of the company's shareholders' equity at the acquisition date?
A) $1,775,000 
B) $475,000 
C) $2,250,000 
D) $0

Snowflake Corp. Penguin, Inc. Acquires 100% of the Outstanding Shares of Snowflake