Givens:

GAGA	BIEBER
CASH	500000	15000
ACCOUNTS RECEIVABLE	400000	3000
LAND	500000	80000
EQUIPMENT	400000	45000
A/D EQUIPMENT	10000	5000
TOTAL ASSETS	1790000	138000
ACCOUNTS PAYABLE	300,000	40,000
COMMON STOCK 10 PAR	400000	30000
ADDITIONAL PAID IN CAPITAL	300000	30000
RETAINED EARNINGS	790,000	38,000

On January 2nd 2016 GAGA purchased 60% of the outstanding shares of BIEBER BY ISSUING 1000 SHARES OF ITS STOCK WHICH HAS A $60 MARKET PRICE PER SHARE At this time BIEBER'S LAND WAS WORTH $55000 AND ITS EQUIPMENT WITH A 5 YEAR LIFE WAS WORTH $10,000. IN ADDITION, BIEBER HAD A CUSTOMER LIST WITH A 10 YEAR LIFE WORTH $19000 ANY EXCESS IS ATTRIBUTABLE TO GOODWILL. GAGA HAS DECIDED THAT BIEBER WILL CONTINUE TO EXIST.

Required:

A) MAKE THE JOURNAL ENTRY GAGA MAKES WHEN IT ISSUES ITS SHARES TO ACQUIRE BIEBER

B) MAKE THE JOURNAL ENTRY BIEBER MAKES WHEN ITS OWNERS EXCHANGE THEIR BIEBER SHARES FOR GAGA SHARES

C) PREPARE A CONSOLIDATED BALANCE SHEET ON JANUARY 3RD

D) MAKE ANY NECESSARY WORKSHEET ENTRIES NEEDED TO PREPARE THE BALANCE SHEET

ADDITIONAL QUESTION (question 3 in the attachment) Perform A-D again but for 60% purchase instead of 100%

Please show all work to help me understand!

THIS IS A TWO PART QUESTION. Part 1 is 100% purchase, part two is 60% purchase.

Where does the customer list come into play? should it be considered in the goodwill calculation? Does the fact that Bieber will continue to exits as a separate entity affect the way the 100% purchase is recorded? For part B, is a journal entry even required? Part D requires worksheet entries like saide, like Entry S, Entry A, Entry D, etc. Please label which letter each entry is.

The GAGA and BIEBER COMPANIES had the following balance sheets on 1/1/2016 GAGA CASH 500000 ACCOUNTS RECEIVABLE 400000 LAND 500000 EQUIPMENT 400000 A/D EQUIPMENT 10000 TOTAL ASSETS 1790000 ACCOUNTS PAYABLE 300,000 COMMON STOCK 10 PAR 400000 ADDITIONAL PAID IN CAPITAL 300000 RETAINED EARNINGS 790,000 On January 2nd 2016 GAGA purchased all of the outstanding shares of BIEBER BY ISSUING 1000 BIEBER'S LAND WAS WORTH $55000 AND ITS EQUIPMENT WITH A 5 YEAR LIFE WAS WORTH $10 IN ADDITION, BIEBER HAD A CUSTOMER LIST WITH A 10 YEAR LIFE WORTH $19000 ANY EXCESS I GAGA HAS DECIDED THAT BIEBER WILL CONTINUE TO EXIST. REQUIRED A) MAKE THE JOURNAL ENTRY GAGA MAKES WHEN IT ISSUES ITS SHARES TO ACQUIRE BIEBER B) MAKE THE JOURNAL ENTRY BIEBER MAKES WHEN ITS OWNERS EXCHANGE THEIR BIEBER SHA C) PREPARE A CONSOLIDATED BALANCE SHEET ON JANUARY 3RD D) MAKE ANY NECESSARY WORKSHEET ENTRIES NEEDED TO PREPARE THE BALANCE SHEET heets on 1/1/2016 BIEBER 15000 3000 80000 45000 5000 138000 40,000 30000 30000 38,000 hares of BIEBER BY ISSUING 1000 SHARES OF ITS STOCK WHICH HAS A $60 MARKET PRICE PER SHARE At t H A 5 YEAR LIFE WAS WORTH $10,000 IFE WORTH $19000 ANY EXCESS IS ATTRIBUTABLE TO GOODWILL TS SHARES TO ACQUIRE BIEBER RS EXCHANGE THEIR BIEBER SHARES FOR GAGA SHARES EPARE THE BALANCE SHEET 0 MARKET PRICE PER SHARE At this time The GAGA and BIEBER COMPANIES had the following balance sheets on 1/1/2016 GAGA BIEBER CASH 500000 15000 ACCOUNTS RECEIVABLE 400000 3000 LAND 500000 80000 EQUIPMENT 400000 45000 10000 5000 TOTAL ASSETS 1790000 138000 ACCOUNTS PAYABLE 300,000 40,000 COMMON STOCK 10 PAR 400000 30000 ADDITIONAL PAID IN CAPITA 300000 30000 RETAINED EARNINGS 790,000 38,000 A/D EQUIPMENT On January 2nd 2016 GAGA purchased 60% of the outstanding shares of BIEBER BY ISSUING 100 BIEBER'S LAND WAS WORTH $55000 AND ITS EQUIPMENT WITH A 5 YEAR LIFE WAS WORTH $10 IN ADDITION, BIEBER HAD A CUSTOMER LIST WITH A 10 YEAR LIFE WORTH $19000 ANY EXCESS I GAGA HAS DECIDED THAT BIEBER WILL CONTINUE TO EXIST. REQUIRED A) MAKE THE JOURNAL ENTRY GAGA MAKES WHEN IT ISSUES ITS SHARES TO ACQUIRE BIEBER B) MAKE THE JOURNAL ENTRY BIEBER MAKES WHEN ITS OWNERS EXCHANGE THEIR BIEBER SHA C) PREPARE A CONSOLIDATED BALANCE SHEET ON JANUARY 3RD D) MAKE ANY NECESSARY WORKSHEET ENTRIES NEEDED TO PREPARE THE BALANCE SHEET EBER BY ISSUING 1000 SHARES OF ITS STOCK WHICH HAS A $60 MARKET PRICE PER SHARE At this time IFE WAS WORTH $10,000 $19000 ANY EXCESS IS ATTRIBUTABLE TO GOODWILL O ACQUIRE BIEBER GE THEIR BIEBER SHARES FOR GAGA SHARES ALANCE SHEET HARE At this time