On January 1, NewTune Company exchanges 17,098 shares of its common stock for all of the outstanding shares of On-the-Go, Inc. Each of NewTune's shares has a $4 par value and a $50 fair value. The fair value of the stock exchanged in the acquisition was considered equal to On-the-Go's fair value. NewTune also paid $26,700 in stock registration and issuance costs in connection with the merger. Several of On-the-Go's accounts' fair values differ from their book values on this date (credit balances in parentheses): Receivables Trademarks Record music catalog In-process research and development Notes payable Book Values Fair Values $ 60,500 $ 55,800 119,750 318,500 75,500 198,500 213,000 (70,500) (62,650) Precombination book values for the two companies are as follows: Cash Receivables Trademarks Record music catalog Equipment (net) Total Assets Accounts payable Notes payable NewTune On-the-Go $ 74,250 $ 34,000 80,750 60,500 423,000 119,750 854,000 75,500 386,000 118,000 $ 1,818,000 $ 407,750 $ (127,000) $ (53,250) (415,000) (70,500) (400,000) Common stock Additional paid-in capital Retained earnings Total liabilities and equities (50,000) (30,000) (30,000) (846,000) (204,000) $(1,818,000) $ (407,750)