Asset Purchase Preston Company acquired the assets (except for cash) and assumed the liabilities of Saville Company. Immediately prior to the acquisition, Saville Company's balance sheet was as follows: LO4 Book Value Fair Value Cash $120,000 $120,000 Receivables (net) 192,000 228,000 Inventory 360,000 396,000 Plant and Equipment (net) 480,000 540,000 Land 420,000 660,000 Total Assets $1,572,000 $1,944,000 Liabilities $540,000 $594,000 Common Stock ($5 par value) 480,000 Other Contributed Capital 132,000 Retained Earnings 420,000 Total Equities $1,572,000 Required:

A. Prepare the journal entries on the books of Preston Company to record the purchase of the assets and assumption of the liabilities of Saville Company if the amount paid was

$1,560,000 in cash.

B. Repeat the requirement in (A) assuming the amount paid was $990,000.