On December $31,$ Pacifica, Incorporated, acquired $100$ percent of the voting stock of Seguros Company. Pacifica will

maintain Seguros as a wholly owned subsidiary with its own legal and accounting identity. The consideration

transferred to the owner of Seguros included $56,050$ newly issued Pacifica common shares $($$$20$ market value, $$5$ par

value$)$ and an agreement to pay an additional $$130,000$ cash if Seguros meets certain project completion goals by

December $31$ of the following year. Pacifica estimates a $50$ percent probability that Seguros will be successful in

meeting these goals and uses a $4$ percent discount rate to represent the time value of money.

Immediately prior to the acquisition, the following data for both firms were available:

In addition, Pacifica assessed a research and development project under way at Seguros to have a fair value of

$$101,000.$ Although not yet recorded on its books, Pacifica paid legal fees of $$19,700$ in connection with the acquisition

and $$8,600$ in stock issue costs.

Required:

a$.$ Prepare Pacifica's journal entries to record the consideration transferred to the former owners of Seguros, the direct

combination costs, and the stock issue and registration costs.

b$.$ and c$.$ Present a worksheet showing the postacquisition column of accounts for Pacifica and the consolidated

balance sheet as of the acquisition date.