The July 31, Year 3, balance sheets of two companies that are parties to a business combination are as follows:

	Red Corp.	Sax Inc.
	Book Value	Book Value	Fair Value
Current assets	$1,600,000	$420,000	$468,000
Plant and equipment	1,040,000	800,000	972,000
Patents	-	-	72,000
Goodwill	40,000	40,000
Total Assets	$2,680,000	$1,260,000
Current liabilities	$1,360,000	$252,000	252,000
Long-term debt	480,000	360,000	384,000
Common shares	720,000	168,000
Retained earnings	120,000	480,000
Total Liabilities and Equity	$2,680,000	$1,260,000

Effective on August 1, Year 3, the shareholders of Sax accepted an offer from Red Corporation to purchase 80% of their common shares. Reds cost for investigating and drawing up the share purchase agreement amounted to $18,000.

Red issued 120,000 common shares with market value of $10 per share to the shareholders of Sax Inc and paid cash $ 50,000 for 80% percent of their shares. Legal fees associated with issuing these shares amounted to $ 8,000 and were paid in cash.

In determining acquisition price, Red Corp. considered Saxs unrecorded customer service contract. The value assigned by independent appraiser for the asset is $20,000.

Required: Prepare the consolidated balance sheet of Red Corporation as at August 1, Year 3.