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Pritano Company acquired all the net assets of Succo Company on December 31, 2013, for $2,073,840 cash. The balance sheet of Succo Company immediately prior
Pritano Company acquired all the net assets of Succo Company on December 31, 2013, for $2,073,840 cash. The balance sheet of Succo Company immediately prior to the acquisition showed: Book value Fair value Current assets $933,520 $933,520 Plant and equipment 1,111,630 1,365,570 Total $2,045,150 $2,299,090 Liabilities $166,360 $235,640 Common stock 471,820 Other contributed capital 636,000 Retained earnings 770,970 Total $2,045,150 As part of the negotiations, Pritano Company agreed to issue 9,920 additional shares of its $10 par value common stock to the stockholders of Succo if the average postcombination earnings over the next three years equaled or exceeded $2,536,900. The fair value of the contingent consideration on the date of acquisition was estimated to be $183,500. The contingent consideration (earnout) was classified as equity rather than as a liability. Prepare the journal entries on the books of Pritano to record the acquisition on December 31, 2013. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit
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