Problem 2-2 Stockholders of Acme Company, Baltic Company, and Colt Company are considering alternative arrangements for a business combination, Balance sheets and the fair values of each company's assets on October 1, 2014, were as follows: Assets Liabilities Common stock, $20 par value Other contributed capital Retained earnings (deficit) Total equities Fair values of assets Acme $3,878,800 $2,026,670 1,992,700 -0- (140,570 ) $3,878,800 $4,215,170 Baltic $7,532,500 $2,193,080 1,784,670 599,330 2,955,420 $7,532,500 $8,996,100 Colt $940,680 $260,620 540,290 190,140 (50,370 ) $940,680 $1,294,850 Acme Company shares have a fair value of $50. A fair (market) price is not available for shares of the other companies because they are dosely held. Fair values of Habilities equal book values. (a) Prepare a balance sheet for the business combination. Assude the following: Acme Company acquires all the assets and assumes all the labilities of Baltic and Colt Companies by Issuing in exchange 140,970 shares of its common stock to Baltic Company and 40,380 shares of its common stock to Colt Company (List assets in order of liquidity. Enter negative account balance with negative sign preceding the number .g. -5,125 or parentheses e.g. (5,125).) (a) Prepare a balance sheet for the business combination. Assume the following: Acme Company acquires all the assets and assumes all the abilities of Baltic and Colt Companies by issuing in exchange 140,970 shares of its common stock to Baltic Company and 40,380 shares of its common stock to Colt Company. (List assets in order of liquidity. Enter negative account balance with negative sign preceding the number e.g. -5,125 or parenthesese.. (5,125).) ACME COMPANY Balance Sheet October 1, 2014 Assets Liabilities and Stockholders' Equity