Exercise 3-4 On January 1, 2013, Perch Company issued 1,400 of its $20 par value common shares with a fair value of $60 per share in exchange for the 1,900 outstanding common shares of Cannon Company in a purchase transaction. Registration costs amounted to $1,536, paid in cash. Just prior to the acquisition, the balance sheets of the two companies were as follows: Peach Company Swartz Company Cash $74,600 $12,430 Accounts receivable (net) 104,110 17,650 Inventory 62,290 23,930 Plant and equipment (net) 103.220 46.180 Land 26,220 21,220 Total assets $370,440 $121,410 Accounts payable $69,660 $19,450 Notes payable 86,720 19,780 Common stock. $20 par value 105.100 39.200 Other contributed capital 64,230 22,270 Retained earnings 44,730 20,710 Total equities $370,440 $121,410 Any difference between the book value of equity and the value implied by the purchase price relates to goodwill.