Following are the account balances of Billy Company and Jean Company as of December 31, 2018. The fair values of Kathy Company's assets and liabilities are also listed. Billy Company Jean Company Jean Company Book Values Book Values Fair Values 12/31/2018 12/31/2018 12/31/2018 Cash $ 625,000 $ 225,000 $ 225,000 Receivables 970,000 280,000 315,000 Inventory 1,405,000 650,000 770,000 Building & Equipment, Net 8,900,000 915,000 925,000 Unpatented Technology 400,000 In-Process Research & Development 200,000 Total Assets 11,900,000 2,070,000 $ 400,000 $ 3,400,000 2,000,000 90,000 $ 1,230,000 90,000 1,230,000 Accounts Payable Notes Payable Common Stock - $20 par value Common Stock - $5 par value Additional Paid in Capital Retained Earnings Total Liabilities and Equity 900,000 5,200,000 11,900,000 220,000 100,000 430,000 2,070,000 Total Fair Values (Assets - Liabilities) is 1,515,000 Additional information On December 31, Billy issues 40,000 shares of its $20 par value common stock for all of the outstanding shares of Jean Company As part of the acquisition agreement, Billy agrees to pay the former owners of Jean $350,000 if certain profit projections are realized over the next three years. Billy calculates the acquisition-date fair value of this contingency at $150,000. In creating this combination, Billy pays $15,000 in stock issue costs and $25,000 in accounting and legal fees. Billy Company Jean Company Book Values Book Values 12/31/2017 12/31/2017 2,300,000 150,000 7,100,000 1,100,000 4,200,000 820,000 Retained Earnings 1/1/17 Revenues Expenses Using the acquisition method, prepare the necessary journal entries and a consolidating worksheet that Billy will make if Jean retains separate legal incorporation and maintain its own accounting systems. The market price of Billy Company's stock on the day of acquisition is $45 per share