Under the acquisition method, the shares issued by Wisconsin are recorded at fair value using the following journal entry: General Joumal Debit Credit Investment in Badger (value of debt and shares issued) 900,000 Common stock (par value) 150,0 Additional paid-in capital (excess over par value) 450.0 Liabilities 300,0 The payment to the broker is accounted for as an expense. The stock issue cost is a reduction in additional paid-in capital. General Journal Debit Credit Professional services expense 30,000 Additional paid-in capital 40,000 Cash 70,000 Allocation of acquisition-date excess fair value: Consideration transferred (fair value) for Badger Stock $ 900,000 Book value of Badger, 6/30 770,000 Fair value in excess of Book value 130,000 Excess fair value (undervalued equipment) 100,000 Excess fair value (overvalued patented technology) (20,000) Goodwill 50,000