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Question 3: (10 points) A1, B1, C1, C3 Ramla company paid $500,000 to purchase the net assets of Dawny Company and $300.000 for Lulu Company.
Question 3: (10 points) A1, B1, C1, C3 Ramla company paid $500,000 to purchase the net assets of Dawny Company and $300.000 for Lulu Company. The net book value of the purchased assets was $400.000 for Dawny and $200,000 for Lulu. The net fair market value for Dawny less than its net book value by $100,000. The net fair market value of Lulu exceeds its net book value by $50,000. Ramla paid legal fees of $100,000 in connection with the combination. Instruction: Prepare journal entries on combination day, for Ramla Corporation
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