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I need help solving Exercise 2 in my Advanced Accounting Class. books. Crown Company will Pemal 2 Exercise 2 (O 3, 4) Acquisition with goodwill.
I need help solving Exercise 2 in my Advanced Accounting Class.
books. Crown Company will Pemal 2 Exercise 2 (O 3, 4) Acquisition with goodwill. Smith Company is acquired by Roan Corporation on July 1, 2015. Roan exchanges 60,000 shares of its $1 par stock, with a fair value of $18 per share, for the net assets of Smith Company. Roan incurs the following costs as a result of this transaction: Acquisition costs.. Stock registration and issuance costs. . .. . . . . ..$25,000 10,000 $35,000 The balance sheet of Smyth Company, on the day of the acquisition, is as follows: Smith Company Balance Sheet July 1, 2015 Assets Liabilities and Equity $100,000 Current liabilities . . . . 80,000 Cash Inventory . Property, plant, and equipment: 500,000 $ 580,000 Stockholders' equity: Land. Buildings (net) Equipment Inef] . $200,000 250,000 200,000 Common stock. $200,000 100,000 120,000 Paid-in capital in excess of par 650,000 Retained earnings $1,000,000 Total liabilities and equity... 420,000 $1,000,000 Total assetsStep by Step Solution
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