Price Corporations wholesale vehicle stributor acquires all of the stack of Squire Service Corporation for one milion shares of Princesto, valued at the best of Prince Professional fees connected with the acquisition are 51.920,000 and costs of registering and long the new shares are 59600 both paid in tash The balance sheets of Prince and Squire immediately prior to the acquisition are shown next Balance Sheets Prince Squire 0.000 As receivable 900.000 432000 Parts ventory 20.000 Vehicle inventory 22090,000 Equiment 64,000,000 2,100.000 $10.000.000 41.000 Gurrent 5.000.00 140,000 Long 0.000 0,000 renos 0.00022 0.000 Tandy 1200,000 120.000 in reviewing Squiry assets and abilities, you determine the following 1. On a descounted present value basis, the accounts receivable have a fair value of $4,160,000, and the long-term labilmes have a fair value of $12.200.000 2. The current replacement cost of the parts inventory 6 59600.000 The current replacement cost of the equipment is 531,200,000 4 Squire occuples its service facilities under an operating lease with ten years remaining. The rent is below current market levels, ging these an estimated tar value of $2.000.000 5. Squire has long-term service contracts with several large fleet owners. These contracts have been profitable the present we of expected profits over the coming term of the contra estimated at $3.200,000 6. Squire has a skilled and experienced workforceYou estimate that the cost to hire and train replacements would be $1.200,000 7. Squire's trade name is well known among fleet owners and is estimated to have a fair value of $320.000 My Sub (a) Prepare the acquisition entry and a working paper to consolidate the balance sheets of Prince and Squire as of the date of acquisition in thousands) Enter your answers in thousands. For example, 556,000,000 is $56,000 in thousands General Journal Description Debit Credit Investment in Squire 56,000 Merger expenses 1.920 0 Capital stock O X Cash 0 The account balances for Prince, shown in the working paper below, reflect the above entry. Merger expenses reduce retained earnings, a component of stockholders Use negative signs with your credit balance answers in the Dr (Cn) columns Enter your answers in thousands. For example, 99,600,000 is 59,600 in thousands Consolidation Working Paper Accounts Taken From Books Eliminations Consolidated Prince Squire Balances (in thousands) Dr (Cr) Dr (Cr) Debit Credit Dr(CT) Cash OXS OX OX Accounts receivable 0 x OX O XOR O X Parts inventory ON (R OX OX Vehicle inventory OX OX Equipment, net 0.X O X OX 0 x OXD OX 0 Investment in Squire OM) (R) ON OX Intangible: Lease IRI OX 0 X Intangible Service contracts OX ON Intangible Trade name OX OX Goodwill OX Current liabilities DX OX OX OX 0X (R) OX Long-termiabilities OK OXE OX Shareholders equity 5 0 OKS OX 0 5 OS 5 Total OX (b) if the acquisition was a merger, Prince records Squire's assets and liabilities directly on its own books. Prepare Prince's entry to record the merger and compare Princesante het immediately after the entry is booked with the consolidated balance sheet in portalin thousands Enter your answers in thousands. For example, 59.600.000 is 19,600 in thousands General Journal Description Debit Credit OX 0 Accounts receivable OX 0 Pares inventory OX D Equipment net 0 incang OX 0 Intangible Service Contracts OM O Intanete Trade Nane DX D Goodwill O ow Menter expenses OX O Cast ON Current liabilities 0 ON Long term abilities D OM DM Capital stock OX Price Corporations wholesale vehicle stributor acquires all of the stack of Squire Service Corporation for one milion shares of Princesto, valued at the best of Prince Professional fees connected with the acquisition are 51.920,000 and costs of registering and long the new shares are 59600 both paid in tash The balance sheets of Prince and Squire immediately prior to the acquisition are shown next Balance Sheets Prince Squire 0.000 As receivable 900.000 432000 Parts ventory 20.000 Vehicle inventory 22090,000 Equiment 64,000,000 2,100.000 $10.000.000 41.000 Gurrent 5.000.00 140,000 Long 0.000 0,000 renos 0.00022 0.000 Tandy 1200,000 120.000 in reviewing Squiry assets and abilities, you determine the following 1. On a descounted present value basis, the accounts receivable have a fair value of $4,160,000, and the long-term labilmes have a fair value of $12.200.000 2. The current replacement cost of the parts inventory 6 59600.000 The current replacement cost of the equipment is 531,200,000 4 Squire occuples its service facilities under an operating lease with ten years remaining. The rent is below current market levels, ging these an estimated tar value of $2.000.000 5. Squire has long-term service contracts with several large fleet owners. These contracts have been profitable the present we of expected profits over the coming term of the contra estimated at $3.200,000 6. Squire has a skilled and experienced workforceYou estimate that the cost to hire and train replacements would be $1.200,000 7. Squire's trade name is well known among fleet owners and is estimated to have a fair value of $320.000 My Sub (a) Prepare the acquisition entry and a working paper to consolidate the balance sheets of Prince and Squire as of the date of acquisition in thousands) Enter your answers in thousands. For example, 556,000,000 is $56,000 in thousands General Journal Description Debit Credit Investment in Squire 56,000 Merger expenses 1.920 0 Capital stock O X Cash 0 The account balances for Prince, shown in the working paper below, reflect the above entry. Merger expenses reduce retained earnings, a component of stockholders Use negative signs with your credit balance answers in the Dr (Cn) columns Enter your answers in thousands. For example, 99,600,000 is 59,600 in thousands Consolidation Working Paper Accounts Taken From Books Eliminations Consolidated Prince Squire Balances (in thousands) Dr (Cr) Dr (Cr) Debit Credit Dr(CT) Cash OXS OX OX Accounts receivable 0 x OX O XOR O X Parts inventory ON (R OX OX Vehicle inventory OX OX Equipment, net 0.X O X OX 0 x OXD OX 0 Investment in Squire OM) (R) ON OX Intangible: Lease IRI OX 0 X Intangible Service contracts OX ON Intangible Trade name OX OX Goodwill OX Current liabilities DX OX OX OX 0X (R) OX Long-termiabilities OK OXE OX Shareholders equity 5 0 OKS OX 0 5 OS 5 Total OX (b) if the acquisition was a merger, Prince records Squire's assets and liabilities directly on its own books. Prepare Prince's entry to record the merger and compare Princesante het immediately after the entry is booked with the consolidated balance sheet in portalin thousands Enter your answers in thousands. For example, 59.600.000 is 19,600 in thousands General Journal Description Debit Credit OX 0 Accounts receivable OX 0 Pares inventory OX D Equipment net 0 incang OX 0 Intangible Service Contracts OM O Intanete Trade Nane DX D Goodwill O ow Menter expenses OX O Cast ON Current liabilities 0 ON Long term abilities D OM DM Capital stock OX