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On Januarv 1, 2022, the Smith and Tavlor Companies had the following Balance Sheets: On January 2nd Taylor acquired 9000 shares of Smith stock by
On Januarv 1, 2022, the Smith and Tavlor Companies had the following Balance Sheets: On January 2nd Taylor acquired 9000 shares of Smith stock by issuing 20,000 shares of its common stock to the owners of Smith. On January 2nd Taylor's stock was selling for $50 per share. Additional information is as follows: FAIR MARKET VALUE OF SMITH'S ASSETS \begin{tabular}{|l|c|} \hline Accounts receivable & $40,000.00 \\ \hline inventory & $50,000.00 \\ \hline equipment & $70,000.00 \\ \hline land & $70,000.00 \\ \hline in process R\&D & $30,000.00 \\ \hline Customer list & $40,000.00 \\ \hline building & $70,000.00 \\ \hline \end{tabular} Both Smith's and Taylor's buildings have a 10 year life straight line no salvage Both Smith's and Taylor's equipment have a 5 year life straight line no salvage 1. Make the journal entry Taylor makes when it acquires Smith's stock 2. Make the journal entry Smith makes when its stock is acquired by Taylor 3. Make the necessary worksheet entries for the consolidation 4. Prepare a consolidated balance sheet on January 2nd 2022
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