On January 1, 2021, Casey Corporation exchanged 53 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) $ 3,213,000 Carrying amount acquired 2,600,000 Excess fair value $ 613,000 to buildings (undervalued) $ 343,000 to licensing agreenente (overvalued) (144,000 199,000 to goodwill indefinite life) $ 414.000 40:14 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 Goodwill Total assets Accounts payable Long-ter det Common stock Additional paid.in capital Retained earnings Total liabilities and equities Casey Kennedy 9 460,000 $ 154,500 1,605,000 289,000 1,435,000 163,500 3,213,000 0 5,625,000 2,590,000 0 2,870,000 386,000 $ 12,724,000 $ 6,067,000 $ (354,000) (457,000) (3,370,000) (3,010,000) (3,000,000) (1,000,000) 0 (500,000) 16.000.000) (1,100,000) $ (12,724,000) $ (6,067,000) 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.) 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, 2021 Adjust. & Elim Casey Kennedy Debit Credit Cash $ 460,000 $ 154,500 Accounts receivable 1,605,000 289,000 Inventory 1.435,000 163,500 Investment in Kennedy 3,213,000 Buildings (net) 5,625,000 2,590,000 Licensing agreements 2,870,000 Goodwil 386,000 Total assets $ 12,724,000$ 6,067.000 Accounts payable $ (354,000) (457.000) Long-term debt (3.370,000) (3,010,000) Common stock (3,000,000) (1,000,000) Additional paid in capital (500,000) Retained earnings (6,000,000) (1,100,000) Total liabilities and equities $(12,724,000) $ (6,067,000) $ 0$ $ 0 $ 0
