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Consider the following premerger information about Firm X and Firm Y: Firm X Firm Y Total earnings $ 95,000 $ 22,000 Shares outstanding 52,000 17,000
| Consider the following premerger information about Firm X and Firm Y: |
| Firm X | Firm Y | |||||
| Total earnings | $ | 95,000 | $ | 22,000 | ||
| Shares outstanding | 52,000 | 17,000 | ||||
| Per-share values: | ||||||
| Market | $ | 52 | $ | 21 | ||
| Book | $ | 15 | $ | 10 | ||
| Assume that Firm X acquires Firm Y by issuing long-term debt for all the shares outstanding at a merger premium of $6 per share, and that neither firm has any debt before the merger. |
| List the assets of the combined firm assuming the purchase accounting method is used. |
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