Question
On January 2, 2013, Illinois Corporation issued 200,000 new shares of its $5 par value common stock valued at $19 a share for all of
On January 2, 2013, Illinois Corporation issued 200,000 new shares of its $5 par value common stock valued at $19 a share for all of North Dakota Company's outstanding common shares. The fair value and book value of North Dakota's identifiable assets and liabilities were the same. Summarized balance sheet information for both companies just before the acquisition on January 2, 2013 is as follows: Illionois North Dakota
Cash $150,000 $240,000
Inventories 320,000 800,000
Other current assets 500,000 1,000,000
Land 350,000 500,000
Property, plant & equipment 4,000,000 3,000,000
Total Assets $5,320,000 $5,540,000
Accounts payable $1,000,000 $600,000
Notes payable 1,300,000 1,320,000
Common stock, $5 par 2,000,000 1,000,000
Additional paid-in capital 1,000,000 200,000
Retained earnings 20,000 2,420,000
Total Liabilities & Equities $5,320,000 $5,540,000
Prepare a consolidated balance sheet for Illinois Corporation immediately after the business combination.
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