3. Nineteen Company had the following summarized balance sheet on December 31 of the current year:

Assets
Cash	$250,000
Accounts receivable	300,000
Inventory	350,000
Property and plant (net)	500,000
Total	$1,400,000
Liabilities and Equity
Bonds payable	$ 600,000
Common stock, $5 par	300,000
Paid-in capital in excess of par	400,000
Retained earnings	100,000
Total	$1,400,000

The fair value of the inventory and property and plant is $500,000 and $750,000, respectively. Bonds payable has a fair value of $585,000.

Assume that Covid Corporation exchanges 80,000 of its $2 par value shares of common stock, when the fair price is $15 per share, for 100% of the common stock of Nineteen Company. Covid incurred acquisition costs of $5,000 and stock issuance costs of $5,000.

Required:

a.

What journal entries will Covid Corporation record for the investment in Nineteen and issuance of stock?

b.

Prepare a supporting value analysis and determination and distribution of excess schedule

c. Prepare Covids elimination and adjustment entry for the acquisition of Nineteen.