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On December 31, 20X9, Frank Corporation acquired all of Bean Company's common shares, for S570.000 cash. On that date, Bean's balance sheet appeared as follows:
On December 31, 20X9, Frank Corporation acquired all of Bean Company's common shares, for S570.000 cash. On that date, Bean's balance sheet appeared as follows: $50,000 70,000 Assets Cash Accounts Receivables Inventory Land Buildings and Equipment (net) $80,000 40,000 100,000 120,000 260,000 Liabilities Current Payables Notes Payable Stockholders' Equity Common Stock Additional Capital Retained Famings Total 150,000 200,000 130,000 $600,000 Total $600,000 The fair values of all of Bean's assets and liabilities were equal to their book values except for the following: Fair Value Inventory S120,000 Land 150,000 Buildings and Equipment 300,000 In recording this acquisition, push-down accounting was used. Required: 1) Record the acquisition of Bean's stock on Frank's books on December 31, 20X9. +5 2) Record any entries that would be made on December 31, 20X9, on Bean's books related to the business combination. +10 3) Present all consolidation entries that would appear in the worksheet to prepare a consolidated balance sheet immediately after the combination. +10
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