Problem 2-29 (Algo) (LO 2-4, 2-5, 2-6b, 2-6c, 2-7) On January 1, 2021, Marshall Company acquired 100 percent of the outstanding common stock of Tucker Company. To acquire these shares, Marshall Issued $267,000 in long-term liabilities and 20,000 shares of common stock having a par value of $1 per share but a fair value of $10 per share. Marshall paid $22,000 to accountants, lawyers, and brokers for assistance in the acquisition and another $7,000 in connection with stock Issuance costs. Prior to these transactions, the balance sheets for the two companies were as follows: Company Cash Receivables Inventory Land Buildings (net) Equipment (net) Accounts payable Long-term liabilities Common stock-$1 par value Common stock-$20 par value Additional paid-in capital Retained earnings, 1/1/21 Marshall Tucker Company Book Value Book Value $ 60,988 $ 38,600 277, eee 91,eee 411,000 192.ee 215,000 224,000 501, eee 276, eee 220, eee 50,7ee (226,000) (54,300) (493, 000) (267,000) (110, 088) (120,000) (360,000) (495,988) (431,eee) Note: Parentheses Indicate a credit balance. In Marshall's appraisal of Tucker, it deemed three accounts to be undervalued on the subsidiary's books: Inventory by $7,400, Land by $33,000, and Buildings by $42,000. Marshall plans to maintain Tucker's separate legal Identity and to operate Tucker as a wholly owned subsidiary a. Determine the amounts that Marshall Company would report in its postacquisition consolidated balance sheet. In preparing the postacquisition balance sheet, any required adjustments to Income accounts from the acquisition should be closed to Marshall's retained earnings. Other accounts will also need to be added or adjusted to reflect the journal entries Marshall prepared in recording the acquisition. b. To verify the answers found in part (a), prepare a worksheet to consolidate the balance sheets of these two companies as of January 1, 2021 Answer is not complete. Complete this question by entering your answers in the tabs below. Required A Required B Determine the amounts that Marshall Company would report in its postacquisition consolidated balance sheet. In preparing the postacquisition balance sheet, any required adjustments to income accounts from the acquisition should be closed to Marshall's retained earnings. Other accounts will also need to be added or adjusted to reflect the journal entries Marshall prepared in recording the acquisition. (Input all amounts as positive values.) Show less Cash Receivables Inventory Land Buildings (net) Equipment (net) Total assets Accounts payable Long-term liabilities Common stock Consolidated Totals $ 31.900 X 91.000 X 199,400 X 224,000 X 278,000 50.700 X IS 873.000 $ (54,300) X (287,000) X 200.000 X Additional paid-in capital Retained earnings Total liabilities and equities IS (121,300)
