On January 1, Richard Company acquired all the net assets of Ulmer Company by issuing debt with a market value of $350,000 and a payment of cash of $300,000. The fair value of Ulmer's identifiable net assets equaled their book values except for buildings and equipment which had a fair value of $120,000 greater than book value. Balance sheets for the two companies immediately preceding the acquisition were as follows:

	Richard Co.	Ulmer Co.
Cash	$400,000	$150,000
Building & Equipment	700,000	400,000
Accumulated Depreciation	(300,000)	(150,000)
Other Identifiable Assets	100,000	200,000
Total Assets	$900,000	$600,000
Liabilities	$200,000	$100,000
Common Stock	400,000	300,000
Additional Paid-in Capital	160,000	100,000
Retained Earnings	140,000	100,000
Total Liabilities and Equity	$900,000	$600,000

1) The total amount of equity (common stock, additional paid-in capital and retained earnings) that should appear on the balance sheet of the combined companies immediately following the merger should be:

a. 700,000

b. 1,100,000

c. 1,050,000

d. 1,400,000

e. none of the above

2) The amount of Goodwill to be recognized in connection with the merger is:

a. 0

b. 30,000

c. 120,000

d. 150,000

3) The dollar balance of the gross amount (i.e. without accumulated depreciation) in the Buildings & Equipment account on the balance sheet of the combined companies immediately following the merger should be:

a. 1,100000

b. 1220000

c. 1,070,000

d. 1090000

e none of the above

e. none of the above