On December 31, 2023, James Corp exchanged 10,000 shares of its $5 par value common stock for all the outstanding shares of Tom Co James's stock on that date has a fair value of $60 per share Following the transaction, the two companies retained their separate legal identities and James Corp prepared a consolidation worksheet as of December 31, 2023, after the acquisition transaction was completed Below is the last column of this consolidated worksheet (i e , the one including the consolidated totals) AccountsConsolidated totals Income Statement Sales (360,000) Expenses 254,000 Net Income (106,000) Statement of Retained Earnings R E, 1 1 23 (480,000) Net Income (106,000) Dividends declared 36,000 R E, 12 31 23 $(550,000) Balance Sheet Current assets 466,000 Investment in Tom Co 0 Land 324,000 Buildings (net) 816,000 Goodwill 72,000 Total Assets $1,678,000 Liabilities (240,000) Common stock (292,000) Additional paid in capital (596,000) R E, 12 31 23 (550,000) Total Liabilities Stockholders' Equity $(1,678,000) Required Using the information provided in the Consolidated totals column above, provide an answer to the following questions Assume there are no acquisition related expenses Based on the information given in the problem, can you calculate the Shareholders Equity (SE) in the individual financial statements of the parent company (James Corp ) at December 31, 2023 right before the acquisition took place Explain why or why not Show your calculations, if any, for each component of SE (i e , Common Stock, Additional Paid in Capital, and Retained Earnings) Assume there are no acquisition related expenses Based on the information given in the problem, can you calculate the SE in the individual financial statements of the subsidiary company (Tom Co ) at December 31, 2023 right before the acquisition was completed Please, explain why or why not Show your calculations, if any, for each component of SE (i e , Common Stock, Additional Paid in Capital, and Retained Earnings) Now assume that at the time of acquisition James Corp paid $10,000 to attorneys and accountants who assisted in creating this combination and incurred $ 5,000 in issuance costs for the stock used in the acquisition Show the journal entry (s) to record these costs Will the answer to question (1) question (2) above change because of the additional acquisition related costs being incurred and by how much Please, explain your answer Show your calculations, if any, for each component of SE The consolidation process will be completed at the end of every future reporting period, using a consolidation worksheet Do you expect that the costs incurred at the time of acquisition will affect the consolidation entries going forward (for example for fiscal years 2024 and beyond) Why or why not

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On December 31, 2023, James Corp. exchanged 10,000 shares of its $5 par value common stock for all the outstanding shares of Tom Co. James's

On December 31, 2023, James Corp. exchanged 10,000 shares of its $5 par value common stock for all the outstanding shares of Tom Co. James's stock on that date has a fair value of $60 per share. Following the transaction, the two companies retained their separate legal identities and James Corp. prepared a consolidation worksheet as of December 31, 2023, after the acquisition transaction was completed. Below is the last column of this consolidated worksheet (i.e., the one including the consolidated totals).

AccountsConsolidated totals

Income Statement Sales (360,000)

Expenses 254,000

Net Income (106,000)

Statement of Retained Earnings R/E, 1/1/23 (480,000)

Net Income (106,000)

Dividends declared 36,000

R/E, 12/31/23 $(550,000)

Balance Sheet

Current assets 466,000

Investment in Tom Co. 0

Land 324,000

Buildings (net) 816,000

Goodwill 72,000

Total Assets $1,678,000

Liabilities (240,000)

Common stock (292,000)

Additional paid-in capital (596,000)

R/E, 12/31/23 (550,000)

Total Liabilities & Stockholders' Equity $(1,678,000)

Required. Using the information provided in the Consolidated totals column above, provide an answer to the following questions:

Assume there are no acquisition-related expenses. Based on the information given in the problem, can you calculate the Shareholders Equity (SE) in the individual financial statements of the parent company (James Corp.) at December 31, 2023 right before the acquisition took place? Explain why or why not. Show your calculations, if any, for each component of SE (i.e., Common Stock, Additional Paid-in Capital, and Retained Earnings)

Assume there are no acquisition-related expenses. Based on the information given in the problem, can you calculate the SE in the individual financial statements of the subsidiary company (Tom Co.) at December 31, 2023 right before the acquisition was completed? Please, explain why or why not. Show your calculations, if any, for each component of SE (i.e., Common Stock, Additional Paid-in Capital, and Retained Earnings)

Now assume that at the time of acquisition James Corp. paid $10,000 to attorneys and accountants who assisted in creating this combination and incurred $ 5,000 in issuance costs for the stock used in the acquisition.
1. Show the journal entry (s) to record these costs
2. Will the answer to question (1) & question (2) above change because of the additional acquisition-related costs being incurred and by how much? Please, explain your answer. Show your calculations, if any, for each component of SE
3. The consolidation process will be completed at the end of every future reporting period, using a consolidation worksheet. Do you expect that the costs incurred at the time of acquisition will affect the consolidation entries going forward (for example for fiscal years 2024 and beyond)? Why or why not?