Balance Sheet (before business combination)

December 31, 2020

Assets

Inventories$250,000

Plant assets (net)300,000

Other assets400,000

Total assets$950,000

Liabilities & Stockholders' Equity

Liabilities$350,000

Common stock, $5 par150,000

Additional paid-in capital250,000

Retained earnings200,000

Total liabilities & stockholders' equity$950,000

On December 31, 2020, VIVAissued 60,000 of its $5 par (current fair value $13) common stock for all the outstanding common stock of Zain, which was then liquidated. Also, on December 31, 2020, VIVApaid $60,000 out-of-pocket costs in connection with the business combination, of which $25,000 were finder's, accounting, and legal fees directly related to the combination, and $35,000 were costs of registering and issuing the common stock to affect the combination. Current fair values of Zain's inventories and plant assets were $260,000 and $320,000, respectively; other assets and liabilities had current fair values equal to their carrying amounts.

Instructions:

Prepare journal entries on December 31, 2020, for VIVACorporation to record the business combination with Zain Company. Disregard income taxes.