Pat Corporation paid $5,000,000 for Saw Corporation's voting common stock on January 2, 2011, and Saw was dissolved, The purchase price consisted of 100,000 shares of Pat's common stock with a market value of $4,000,000, plus $1,000,000 cash. In addition, Pat paid $100,000 for registering and issuing the 100,000 shares of connnon stock and $200,000 for other costs of combination. Balance sheet information for the companies immediately before the acquisition is summarized as fo]lows (in thousands): Pat Saw Book Value Book Value Fair Value Cash $ 6,000 $ 480 $ 480 Accounts receivablenet 2,600 720 720 Notes receivablenet 3,000 600 600 Inventories 5,000 840 1,000 Other current assets 1,400 360 400 Land 4,000 200 400 Buildingsnet 18,000 1,200 2,400 Equipmentnet 20,000 1,600 1,200 Total assets $60,000 $6,000 $7,200 Accounts payable $ 2,000 $ 600 $ 600 Mortgage payable10% 10,000 1,400 1,200 Capital stock, $10 par 20,000 2,000 Other paid~in capital 16,000 1,200 Retained earnings 12,000 800 Total equities $60,000 $6,000 A0515 (Booklet 1 ) September 2017