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Presented below are the financial balances for the Atwood Company and the Franz Company as of December 31 2012, immediately before Atwood acquired Franz Also

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Presented below are the financial balances for the Atwood Company and the Franz Company as of December 31 2012, immediately before Atwood acquired Franz Also included are the "fair values for Franz Company's net assets at that date Atwood Franz Co. Franz Co. (all amounts in thousands) Book Value Book Value Fair Value 12/31/14 12/31/14 12/31/14 $ 240 S870 660 1,230 1 800 1.800 $ 240 600 420 600 580 250 650 540 66 380 400 Receivables Inventory Land Buildings (net) Equipment (net) Accounts payable Accrued expenses Long-term liabilities Common stock (520 par) Common stock (55 par) Additional paid-in capital Retained earnings Revenues Expenses (570) (270) (2.700) (1,980) (240) ( 60) (1,020) ( 240) ( 60) (1.120) (420) ( 180) (210) (1.170) (2880) 2,760 ( 480) (660) Note: Parenthesis idicate a credit balance Assume a business combination took place at December 31, 2012 Atwood issued 50 shares of its common stock with a fair value of $35 per share for all of the outstanding common shares of Franz Stock issuance costs of $15 in thousands) and direct costs of $10 in thousands were paid to effect this acquisition transaction. To settle a difference of opinion regarding Franz's fair value, Atwood promises to pay an additional $52 in thousands to the former owners i Franz's earnings exceed a certain sum during the next year Given the probability of the required contingency payment and thing a 4% discount rate the expected present value of the contingency is $5 (in thousands Compute consolidated expenses at date of acquisition Note Parenthesis indicate a credit balance Assume a business combination took place at December 31, 2012 Atwood issued 50 shares of its common stock with a fair value of 535 per share for all of the outstanding common shares of Franz Stock Issuance costs of $15 in thousands) and direct costs of $10 in thousands) were paid to effect this acquisition transaction. To settle a difference of opinion regarding Franz's fair value, Atwood promises to pay an additional $5 2 in thousands) to the former owners if Franz's earrings exceed a certain sur during the next year. Given the probability of the required contingency payment and utilizing a 4% discount rate, the expected present value of the contingency 55 in thousands Compute consolidated expenses at date of acquisition O $2,735 O $2760 O $2770 52785 $3,380

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