On January 1, 2021, Casey Corporation exchanged $3,251,000 cash for 100 percent of the outstanding voting stock of Kennedy Corporation Casey plans to maintain Kennedy as a wholly owned subsidiary with separate legal status and accounting information Systems At the acquisition date. Casey prepared the following fair value allocation schedule: Fair value of Kennedy (consideration transferred) $ 3,251,000 Carrying amount acquired 2,600,000 Excess fair value $ 651,00 to buildings (undervalued) $322,000 to licensing agreements (overvalued) (141,000) 181,000 to goodwill (indefinite life) $ 478,000 immediately after closing the transaction. Casey and Kennedy prepared the following postacquisition balance sheets from their separate financial records (credit balances in parentheses) Accounts Cash Accounts receivable Inventory Investment in Kennedy Buildings (net) Licensing agreements Goodwin Total assets Accounts payable Long term debt Connon stock Additional paid in capital Retained earnings Total labilities and equities Casey Kennedy 493,000 $ 171.000 1,650,000 348,000 1,620,000 140,000 3,251,000 6,067,500 2,830,000 e 3,080,000 244,500 $ 13,326,00 $ 5,569,000 $ (386,000) $ (429,000) (3,940,000) (3,548,60e) (3,000,00) (1,000,000) (500,000) (6,000,000 (1,100,000 5 (13,326,000) $ (6,569.000) Prepare an acquisition date consolidated balance sheet for Casey Corporation and its subsidiary Kennedy Corporation. (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. Input all amounts as positive values.) CASEY CORPORATION AND CONSOLIDATED SUBSIDIARY KENNEDY Worksheet for a consolidated Balance Sheet January 1, 2021 Retained earnings Total liabilities and equities (6.690,000 (11,100,000 $ (13,326,00) $ (6,569,000) Prepare an acquisition-date consolidated balance sheet for Casey Corporation and its subsidiary Kennedy Corporation (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. Input all amounts as positive values.) Consolidated CASEY CORPORATION AND CONSOLIDATED SUBSIDIARY KENNEDY Worksheet for a consolidated Balance Sheet January 1, 21/21 Adjust. & Elim Casey Kennedy Debit Credit Cash $ 493,000 $ 171.000 Accounts receivable 1,650,000 348,000 Inventory 1.620,000 140.000 Investment in Kennedy 3,251,000 Buildings (net) 6,067 500 2,830,000 Licensing agreements 3,080 000 Goodwill 244,500 Total assets $ 13,326,000 5 6,569,000 Accounts payable $ (386.000) (429,000) Long-term deb: (3,940,000) (3.540,000) Common stock (3,000,000) (1,000,000) Additional pald-in capital (500,000) Retained ornings (6.000.000) (1.100,000) Total liabilities and equities $(13,326,000) $ (6.569.000)
