On January 1, 2016, Prima Company issued 1,500 of its $20 par value common shares with a fair value of $50 per share in exchange for 2,000 outstanding common shares of Swatch Company in a purchase transaction. Registration costs amounted to $1,700 paid in cash. Just prior to the acquisition, the balance sheets of the two companies were as follows:

Prima Swatch

Cash $ 73,000 $13,000

Accounts Receivable (net) 95,000 19,000

Inventory 58,000 25,000

Plant and Equipment (net) 95,000 43,000

Land 26,000 20,000

Total Assets $ 347,000 $ 120,000

Accounts Payable $ 66,000 16,000

Notes Payable 82,000 21,000

Common Stock, $20 par value 100,000 40,000

Other Contributed Capital 60,000 24,000

Retained Earnings 39,000 19,000

Total Liabilities and Equities $ 347,000 $ 120,000

Any differences between the book value of equity and the value implied by the purchase price relates to

Land.

Required:

A. Prepare the journal entry on Primas books to record the exchange of stock.

B. Prepare a Computation and Allocation Schedule for the Difference between book value and value

implied by the purchase price.

C. Calculate the consolidated balance for each of the following accounts as of December 31, 2016:

1. cash 2. land 3. common stock 4. other contributed capital