McDermott Corporation has been in the midst of a major expansion program. Much of its growth had been internal, but in 20X 1 McDermott decided to continue its expansion through the acquisition of other companies. The first company acquired was Tippy Inc.. a small manufacturer of inertial guidance systems for aircraft and missiles. On June 10. 20X 1 , M cDermott issued 1 7,000 shares of its $25 par common stock for all 40.000 of Tippy's $10 par common shares. At the date of combination. Tippy reported additional paid-in capital of $100,000 and retained earnings of

$350,000. McDermott's stock was selling for S58 per share immediately prior to the combination.

Subsequent to the combination, Tippy operated as a subsidiary of McDermott.

Required Present the journal entry or entries that McDermott would make to record the business combination with Tippy as a pooling of interests.