9:23 AM Prepare a balance sheet for Petrello Company immediately after the merger. SE 2-3 Asset Purchase, Cash and Stock L06 Pretzel Company acquired the assets (except for cash) and assumed the liabilities of Salt Com- pany on January 2, 2012. As compensation, Pretzel Company gave 30,000 shares of its common stock, 15,000 shares of its 10% preferred stock, and cash of $50,000 to the stockholders of Sale! Company. On the acquisition date, Pretzel Company stock had the following characteristics PRETZEL COMPANY Stock Par Value Fair Value Common $ 10 $ 25 Preferred Ibo 200 Immediately prior to the acquisition, Salt Company's balance sheet reported the following book values and fair values: SALT COMPANY Balance Sheet January 2, 2012 Book oale Fairsalue $ 165,000 $ 165,000 Accounts receivable (net of $11,000 allowance) 220,000 198,000 Inventory--LIFO cost 275,000 390,000 Land 996,000 550,000 Buildings and equipment (net) 1.144.000 1.144.000 Toual assets $2,200,000 $2,387.000 Current liabilities $ 275,000 $275,000 Bonds Payable, 10% 460,000 495,000 Common stock, $5 par value 779.000 Other contributed capital 996,000 309,000 Retained earnings $1,200,000 Total liabilities and stockholders' equity Required: Prepare the journal entry on the books of Pretzel Company to record the acquisition of the assets and assumption of the habilities of Salt Company