On January 1, 2018, Marshall Company acquired 100 percent of the outstanding common stock of Tucker Company. To acquire these shares, Marshall issued $313,000 in long-term liabilities and 20,000 shares of common stock having a par value of $1 per share but a fair value of $10 per share. Marshall paid $23,000 to accountants, lawyers, and brokers for assistance in the acquisition and another $8,000 in connection with stock issuance costs.

Prior to these transactions, the balance sheets for the two companies were as follows:

	Marshall Company Book Value				Tucker Company Book Value
Cash	$	86,700			$	33,200
Receivables		298,000				125,000
Inventory		414,000				238,000
Land		206,000				212,000
Buildings (net)		463,000				276,000
Equipment (net)		223,000				79,500
Accounts payable		(195,000)				(60,900)
Long-term liabilities		(500,000)				(313,000)
Common stock$1 par value		(110,000)
Common stock$20 par value						(120,000)
Additional paid-in capital		(360,000)				0
Retained earnings, 1/1/18		(525,700)				(469,800)

Note: Parentheses indicate a credit balance.

In Marshalls appraisal of Tucker, it deemed three accounts to be undervalued on the subsidiarys books: Inventory by $7,650, Land by $28,800, and Buildings by $37,000. Marshall plans to maintain Tuckers separate legal identity and to operate Tucker as a wholly owned subsidiary.

A. Determine the amounts that Marshall Company would report in its postacquisition balance sheet. In preparing the postacquisition balance sheet, any required adjustments to income accounts from the acquisition should be closed to Marshalls retained earnings. Other accounts will also need to be added or adjusted to reflect the journal entries Marshall prepared in recording the acquisition.

B. To verify the answers found in part (a), prepare a worksheet to consolidate the balance sheets of these two companies as of January 1, 2018.

(A) Determine the amounts that Marshall Company would report in its postacquisition balance sheet. In preparing the postacquisition balance sheet, any required adjustments to income accounts from the acquisition should be closed to Marshalls retained earnings. Other accounts will also need to be added or adjusted to reflect the journal entries Marshall prepared in recording the acquisition.

(B) To verify the answers found in part (a), prepare a worksheet to consolidate the balance sheets of these two companies as of January 1, 2018. (For accounts where multiple consolidation entries are required, combine all debit entries into one amount and enter this amount in the debit column of the worksheet. Similarly, combine all credit entries into one amount and enter this amount in the credit column of the worksheet.)

Consolidated Totals Cash Receivables Inventory Land Buildings (net) Equipment (net) Total assets Accounts payable Long-term liabilities Common stock Additional paid-in capital Retained earnings Total liabilities and equities MARSHALL COMPANY AND CONSOLIDATED SUBSIDIARY Worksheet January 1, 2018 Marshall Tucker Consolidation Entries Company Company Debit Credit Accounts Consolidated Totals Cash Receivables Inventory Land Buildings (net) Equipment (net) Investment in Tucker Total assets Accounts payable Long-term liabilities Common stock Additional paid-in capital Retained earnings, 1/1/18 Total liabilities and owners' equities $ 0 $ 0 $ 0 $