Myers Company Ltd. was formed 10 years ago by the issuance of 23,000 common shares to three shareholders. Four years later, the company went public and issued an additional 30,000 common shares. The management of Myers is considering a takeover in which Myers would purchase all of the assets and assume all of the liabilities of Norris Inc. Two alternative proposals are being considered: PROPOSAL 1 Myers would offer to pay $413,100 cash for the Norris net assets. In addition, Myers would incur legal, appraisal, and finders' fees for a total cost of $5,100. PROPOSAL 2 Myers would issue 51,000 shares currently trading at $8.10 each for the Norris net assets. Other costs associated with the takeover would be as follows: Legal, appraisal, and finders' fees Costs of issuing shares $ 5,100 7,100 $12,200 Norris shareholders would be offered five seats on the 10-member board of directors of Myers, and the management of Norris would be absorbed into the surviving company. Balance sheet data for the two companies prior to the combination are as follows: Cash Accounts receivable Inventory Land Buildings (net) Equipment (net) Myers Carrying Amount $ 561,000 168,200 375, 120 426,000 251,505 79,945 $1,861,770 $ 134,335 420,000 501,000 806,435 $1,861, 770 Norris Carrying Fair Amount Value $ 53,500 $ 53,500 62,450 57,200 111,110 135, 220 76,000 211,000 22,020 25,020 18,705 16,945 $343, 785 $ 42,115 42,115 151,000 156,000 101,000 49,670 $343,785 Current liabilities Non-current liabilities Common shares Retained earnings Journal entry worksheet Record the professional fees expense paid. Note: Enter debits before credits. General Journal Debit Credit Transaction 2 Record entry Clear entry View general journal Journal entry worksheet A B > Record the acquisition of Norris Inc. Note: Enter debits before credits. General Journal Debit Credit Transaction 1 Journal entry worksheet A B > Record the professional fees expense paid and costs of issuing shares. Note: Enter debits before credits. General Journal Debit Credit Transaction 2 Record entry Clear entry View general Journal