Problem 3-7 Balance sheets for Prego Company and Sprague Company as of December 31, 2013, follow: Cash Accounts receivable (net) Inventory Property and equipment (net) Land Total assets Prego Company Sprague Company $706,200 $109,900 885,200 231,800 547,900 60,400 1,926,500 470,900 118,900 94,600 $4,184,700 $967,600 Accounts payable Notes payable Long-term debt Common stock Other contributed capital Retained earnings Total equities $302,700 585,000 350,900 1,782,100 539,300 624,700 $4,184,700 $150,900 60,500 90,900 498,900 80,800 85,600 $967,600 The fair values of Sprague Company's assets and liabilities are equal to their book values. Prepare a consolidated balance sheet as of January 1, 2014, assuming on January 1, 2014, Prego Company exchanged 19,959 of its $20 par value common shares with a fair value of $30 per share for 90% of the outstanding common shares of Sprague Company. The transaction is a purchase. (List assets in order of liquidity.) PREGO COMPANY AND SUBSIDIARY Consolidated Balance Sheet