Following are the balance sheets of Power Boogie Musical Corporation and Shoot-Toot Tuba Company as of December 31, 20X5.

In preparation for a possible business combination, a team of experts from Power Boogie Musical made a thorough examination and audit of Shoot-Toot Tuba. They found that Shoot-Toot’s assets and liabilities were correctly stated except that they estimated uncollectible accounts at $1,400. The experts also estimated the market value of the inventory at $35,000 and the market value of the plant and equipment at $500,000.

The business combination took place on January 1, 20X6, and on that date Power Boogie Musical acquired all the assets and liabilities of Shoot-Toot Tuba. On that date, Power Boogie’s common stock was selling for $55 per share.

Required 

Record the combination on Power Boogie’s books assuming that Power Boogie issued 9,000 of its $10 par common shares in exchange for Shoot-Toot’s assets and liabilities.

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POWER BOOGIE MUSICAL CORPORATION Balance Sheet Docomber 31, 20X5 Assots Cash Accounts Receivable Allowance for Uncollectible Accounts Inventory Plant & Equipment Accumulated Depreciation Other Assets Total Assets $ 23,000 85,000 (1,200) 192,000 980,000 (160,000) 14,000 $1,132,800 Liabilities & Equitios Accounts Payable Notes Payable Mortgage Payable Bonds Payable Capital Stock ($10 par) Premium on Capital Stock Retained Earnings Total Liabilities & Equities $ 48.000 65,000 200,000 200,000 500,000 1,000 118,800 $1,132,800