Q26:Ali Company acquired Khalifa Company in a statutory merger. In payment, Ali Co. issued 100,000 shares of $3 par share capital. At the time of the merger, Ali Company stock was selling for $11 per share. Just before the acquisition, balance sheet amounts for both Ali Company and Khalifa Company are given below:

Q27: What will be the total balance in the share premium account in the books of Ali after the acquisition?

1. $150,000
2. $950,000
3. $1,200,000
4. $1,050,000

Q28: Refer to the Ali/Khalifa question. What will be the total balance in the goodwill account in the books of Ali after the acquisition?

1. $505,000
2. $695,000
3. $0 because goodwill will not be recorded in this case.
4. $555,000

Q29: Refer to the Ali/Khalifa question above. What will be the total balance in the share capital account in the books of All after the acquisition?

1. $550,000
2. $1,200,000
3. $500,000
4. $300,000