Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

On June 30, 2017, Wisconsin, Inc., issued $315,450 in debt and 18,100 new shares of its $10 par value stock to Badger Company owners in

On June 30, 2017, Wisconsin, Inc., issued $315,450 in debt and 18,100 new shares of its $10 par value stock to Badger Company owners in exchange for all of the outstanding shares of that company. Wisconsin shares had a fair value of $40 per share. Prior to the combination, the financial statements for Wisconsin and Badger for the six-month period ending June 30, 2017, were as follows:

Wisconsin Badger
Revenues $ (985,000 ) $ (462,000 )
Expenses 707,000 293,000
Net income $ (278,000 ) $ (169,000 )
Retained earnings, 1/1 $ (801,000 ) $ (236,000 )
Net income (278,000 ) (169,000 )
Dividends declared 105,000 0
Retained earnings, 6/30 $ (974,000 ) $ (405,000 )
Cash $ 42,000 $ 79,000
Receivables and inventory 413,000 216,000
Patented technology (net) 911,000 347,000
Equipment (net) 739,000 664,000
Total assets $ 2,105,000 $ 1,306,000
Liabilities $ (501,000 ) $ (431,000 )
Common stock (360,000 ) (200,000 )
Additional paid-in capital (270,000 ) (270,000 )
Retained earnings (974,000 ) (405,000 )
Total liabilities and equities $ (2,105,000 ) $ (1,306,000 )

Wisconsin also paid $39,700 to a broker for arranging the transaction. In addition, Wisconsin paid $41,600 in stock issuance costs. Badgers equipment was actually worth $796,750, but its patented technology was valued at only $322,900.

What are the consolidated balances for the following accounts? (Input all amounts as positive values)

Accounts Amount
A. Net income
B. Retained earnings, 1/1/17
C. Patented technology
D. Goodwill
E. Liabilities
F. Common stock
G. Additionals paid in capital

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Auditing

Authors: Alan H. Millichamp

8th Edition

082645500X, 9780826455000

More Books

Students also viewed these Accounting questions