Plastic Corporation is contemplating a business combination with Steel Corporation at December 31, 2015. Steel's condensed balance sheet on that date appears below (in millions):

Required 

Prepare the journal entry to record the business combination of Plastic and Steel for each of the following acquisition costs and combination methods.

a. Plastic merges with Steel by acquiring all of Steel's stock for \($125,000\) cash, in a merger. Other direct cash acquisition costs are \($25,000.\)

b. Plastic merges with Steel by acquiring all of Steel's stock for \($100,000\) cash, in a merger. Other direct cash acquisition costs are \($10,000.\)

c. Plastic acquires all of Steel's stock for \($135,000\) cash, in a stock acquisition. Other direct cash acquisition costs are \($15,000.\)

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Assets Cash and receivables. Inventory.... Equity method investments Land.... Buildings and equipment. Patents. Total assets Liabilities and Stockholders' Equity Liabilities... Common stock. Retained earnings Total liabilities and equity... Book Value Fair Value $ 35,000 $35,000 35,000 45,000 18,000 20,000 8,000 11,000 7,000 14,000 5,000 10,000 $108,000 22,000 $ 22,000 50,000 36,000 $108,000