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Problem 5 During the current year, Bradley Company acquired all of the outstanding common stock of Cortez Inc. paying $12,000,000 cash. The book values and
Problem 5
During the current year, Bradley Company acquired all of the outstanding common stock of Cortez Inc. paying $12,000,000 cash. The book values and fair values of Cortezs assets and liabilities acquired are listed below:
Book Value Fair Value
Accounts receivable $1,800,000 $1,625,000
Inventories 2,700,000 4,000,000
Property, plant, and equipment 9,000,000 11,625,000
Accounts payable 3,000,000 3,000,000
Bonds payable 4,500,000 4,125,000
Required:
Prepare the journal entry to record the acquisition by Bradley Company.
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