Problem 1: Here are the trial balances for the Poster Co. and the Sign Co. just before the books were closed on December 31, 2020. Fair market values for selected Sign Co. accounts are shown. Poster Sign Sign Trial Trial Fair Mkt Balance Balance Values Current assets Noncurrent assets (net) Liabilities 175,000 70,000 75,000 255,000 105,000 144,000 (65,000) (45,000) (45,000) Common Stock (Par) $15 (300,000) Common Stock (Par) $30 (60,000) Additional paid in capital (10,000) (20,000) Retained earnings 1/1/20 (65,000) (30,000) Revenues (110,000) (90,000) Expenses 120,000 70,000 On December 31, 2020, Poster Co. purchased 100% of Sign Company's stock by issuing 4,500 shares of its own stock and paying $110,000 cash. On that date, the market value of Poster Company's stock was $25 per share. There were no combination costs or stock issuance costs. Sign Co. was dissolved immediately after the takeover and no longer existed independently. Make all necessary journal entries in Poster Company's records to recognize this acquisition.