Pintime Industries Incorporated entered into a business combination agreement with Sydrolized Chemical Corporation (SCC) to ensure an uninterrupted supply of key raw materials and to realize certain economies from combining the operating processes and the marketing efforts of the two companies. Under the terms of the agreement, Pintime issued 180,000 shares of its $1 par common stock in exchange for all of SCC's assets and liabilities. The Pintime shares then were distributed to SCC's shareholders, and SCC was liquidated. Immediately prior to the combination, SCC's balance sheet appeared as follows, with fair values also indicated: Book Values Fair Values $ 28,000 258,000 (6,500) $ 28,000 251,500 381,000 150,000 55,000 130,000 Assets Cash Accounts Receivable Less: Allowance for Bad Debts Inventory Long-Term Investments Land Rolling Stock Plant and Equipment Less: Accumulated Depreciation Patents Special Licenses Total Assets Liabilities Current Payables Mortgages Payable Equipment Trust Notes Debentures Payable Less: Discount on Debentures Total Liabilities Stockholders' Equity Common Stock ($5 par) Additional Paid-In Capital from Common Stock Additional Paid-In Capital from Retirement of Preferred Stock Retained Earnings Less: Treasury Stock (1,500 shares) Total Liabilities and Equity 2,425,000 (614,000) 125,000 95,800 $ 3,027,300 $ 137,200 500,000 100,000 1,000,000 (40,000) $ 1,697,200 600,000 500,000 22,000 220, 100 (12,000) $ 3,027,300 395,000 175,000 100,000 63,000 2,500,000 500,000 100,000 $ 4,112,500 $ 137,200 520,000 95,000 950,000 $ 1,702,200 Immediately prior to the combination, Pintime's common stock was selling for $14 per share. Pintime incurred direct costs of $135,000 in arranging the business combination and $42,000 of costs associated with registering and issuing the common stock used in the Immediately prior to the combination, Pintime's common stock was selling for $14 per share. Pintime incurred direct costs of $135,000 in arranging the business combination and $42,000 of costs associated with registering and issuing the common stock used in the combination. Required: a. Prepare all journal entries that Pintime should have entered on its books to record the business combination. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. View transaction list Record the payment of legal fees. Record the costs of issuing stock. Record the purchase of SCC. X Credit 135,000 Note: = journal entry has been entered Record entry Clear entry b. Prepare all journal entries that should have been entered on SCC's books to record the combination and the distribution of the stock received. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. View transaction list Record the sale of assets and liabilities. Record the retirement of Treasury Stock. Record the retirement of SCC stock and distribution of Pintime Industries stock. X View general journal " Credit A